12 free CySEC AML Chapter 4 flashcards. Tap a card to flip, or use the arrow keys to move through the deck.
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Culture
What is the cornerstone of an AML compliance culture?
Compliance with AML laws takes precedence over business priorities and profit-making.
Why must compliance outrank profit?
If revenue is allowed to trump compliance, the whole AML framework collapses and the firm is exposed to ML/TF abuse and enforcement.
Core elements
What are the four basic elements of an AML/CFT programme?
Risk-based internal policies and controls, a designated AML Compliance Officer, ongoing employee training, and an independent audit function.
Governance
Who must approve a firm's AML/CFT policies?
Senior Management or the Board of Directors — setting the tone for the whole organisation (Article 58C).
What must the Board do with the AMLCO's Annual Report?
Review and approve it, and act on any weaknesses it reveals — closing the governance loop.
Board duties
What are the Board's key AML responsibilities?
Appointing the AML Compliance Officer, approving the risk management and procedures manual, ensuring resources, and reviewing/approving the AMLCO's Annual Report.
What does Article 58D require of the Board?
A named Board member must own the implementation of the AML/CFT Law and the Supervisory Authority's directives — a single point of Board-level accountability.
Controls
How should AML controls relate to the firm's ML risk?
They must be proportionate (analogous) to the ML risks faced — stronger controls for higher risk — and reviewed and updated regularly.
Audit
What is the role of the independent audit function?
To continually monitor and evaluate the effectiveness of the firm's AML policies and controls, independently of the compliance function it tests.
AMLCO
What day-to-day role sits at the centre of the compliance function?
A designated AML Compliance Officer with day-to-day oversight of the compliance function.
Policies
Where must the firm's AML controls be documented?
In the risk management and procedures manual, so staff apply them uniformly.
Senior management
What ongoing duty does senior management have over AML measures?
To monitor the measures and, where needed, reinforce them — not merely approve them once (Article 58C).