The process of money laundering

Lecture 3. Applying a risk-based approach to a model AML/CFT regime

Key words

· activities

· bankers’ drafts

· commeasurable

· commodity futures

· customer

· customer due diligence (CDD)

· defense

· designated non-financial businesses and professions (DNFBPs)

· dissemination

· efficient allocation

· express trust

· factoring

· field operations

· financial commitments

· financial institutions

· financial intelligence unit (FIU)

· forfeiting

· index instruments

· interest rate instruments

· investigative authorities

· investment related

· judge

· law enforcement authorities

· liquid securities

· money laundering and terrorist financing typologies

· money or value transfer services (MVTS)

· money orders

· nominee shareholder

· operations

· prosecution

· record-keeping

· recourse

· regulatory agencies

· risk-based approach (RBA)

· safekeeping

· self-regulatory bodies (SRBs)

· sole practitioner

· supervisory agencies

· suspicious transaction report (STR)

· traveler’s cheques

· trial

· trust and company service providers (TCSP)

· undertaking

· underwriting

Key Questions

· List main actors of a national AML/CFT regime.

· What is record-keeping?

· Why is it important to undertake CDD measures?

· What is the purpose of regulating and supervising the private sector?

· How can the private sector produce information for an STR?

· What kind of relevant information can the FIU obtain?

· Why would the FIU compile money laundering and terrorist financing typologies?

· Why law enforcement authorities request information from the FIU?

· What is the risk-based approach?

· How does the risk-based approach allow to allocate resources efficiently?

· Why is it necessary for the AML/CFT measures to be commeasurable with the risks identified?

· Why do actors of a national AML/CFT regime need to have effective mechanisms of cooperation and coordination?

· At which levels do mechanisms of cooperation and coordination need to be established?

· What does underwriting and placement of life insurance mean?

· Why do insurance intermediaries have to be subjected to AML/CFT requirements?

· Why the financial leasing activity AML/CFT requirements do not extend to consumer products?

· List the means of payment that can be issued and managed.

· Which persons, related to provision of money or value transfer services, are exempt from AML/CFT requirements?

· List the money market instruments.

· List categories of designated non-financial businesses and professionals.

· Describe two groups of activities undertaken by trust and company service providers.

· List three goals of assessing national risks of money laundering and terrorist financing.

· Which actors serve as recipients of information on the results of country’s money laundering and terrorist financing risk assessments?

· When is it possible to apply AML/CFT requirements to another type of institution, activity, business or profession?

· Under which circumstances is it possible to make exemptions and decide not to apply AML/CFT requirements to a particular type of a financial institution, activity or DNFBP?

· What should persons whose activity has been exempt from AML/CFT requirements do with gathered information? Which of the FATF Recommendations applies?

3.1. Key institutions of a national AML/CFT regime

Date: 2015-01-29; view: 1151