February 2020

International

The Financial Action Task Force (FATF)

Published high-risk jurisdictions subject to a call for action on 21 Feb 2020 which identifies jurisdictions with strategic deficiencies in AML/CFT measures. The Democratic People’s Republic of Korea and Iran remain on the FATF list.
Updated its list of jurisdictions under increased monitoring on 21 Feb 2020. Albania, Barbados, Jamaica, Mauritius, Myanmar, Nicaragua and Uganda have been added to the list and Trinidad and Tobago have come off the list so are no longer subject to FATF’s ongoing monitoring process. We have incorporated this into our country risk rating update on 26 Feb 2020.
Updated its consolidated assessment ratings which provides an up-to-date overview of the ratings that assessed countries obtained for effectiveness and technical compliance.

No major updates this month.

The Department of Internal Affairs (DIA)

Published Sector Risk Assessment (SRAs) for Financial Institutions and Designated Non-Financial Businesses or Professions (DNFBPs) and Casinos. These SRAs replace the previous Phase 1 and Phase 2 SRAs published in 2017 and 2018. The name changes reflect that the implementation of Phase 2 of New Zealand’s AML/CFT regime is now complete. In addition to the name changes, there have been some updates to the risk assessment content. Reporting entities should consider whether they need to review and update their own risk assessments and AML/CFT programmes.
Published a Anti-Money Laundering and Countering Financing of Terrorism Regulatory Findings Report for the 12 months ended 30 June 2019. The report pointed out the following most common areas of non-compliance:

Risk assessments too generic and not specific to the money laundering and financing terrorism risks the business faced.
Written documents incomplete and not covering all the relevant obligations. These include a lack of procedures for politically exposed person (PEP) checking, beneficial ownership checks, enhanced customer due diligence, suspicious activity and prescribed transaction reporting.
The written AML/CFT programme documentation is technically compliant but not implemented effectively in practice.
Compliance officers’ inadequate understanding of their businesses’ money laundering and financing terrorism risks, and poor implementation of policies, procedures and controls in practice.
Customer due diligence (CDD) and Enhanced CDD not undertaken in accordance with the Act’s requirements.
The compliance officer does not have the required level of influence in the business to escalate issues and ensure governance level support for the AML/CFT programme.
Insufficient training and vetting of senior management, compliance officers and any staff member with AML/CFT duties.
AML/CFT risk assessment and programme documents not kept up to date, with no version control used.

Published Regulatory Framework 2020 that summarises the DIA’s approach to AML/CFT supervision. This one-page document outlines their purpose and provides an overview of their approach to education, engagement, monitoring and enforcement.

No major updates this month.

No major updates this month.

The Gambling Commission

Announced that Mr Green will pay £3m to the National Strategy to Reduce Gambling Harms because it failed to have effective procedures aimed at preventing harm and money laundering.

The European Banking Authority (EBA)

Issued a public consultation on revised ML/TF risk factors guidelines as part of a broader communication on AML/CFT issues. This update takes into account changes to the EU AML/CFT legal framework and new ML/TF risks, including those identified by the EBA’s implementation reviews. The consultation runs until 5 May 2020.
Published its first report on competent authorities’ approaches to the AML/CFT supervision of banks. This publication is part of the EBA’s new role to lead, coordinate and monitor the fight against ML/TF in all EU Member States, which is further explained in the accompanying factsheet.

No major updates this month.