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Anti-Money Laundering/Combating Financing of Terrorism and Complying with IFRS 9 – The Environment

From our understanding in dealing with the various countries, there is a concern by some Regulators that the Caribbean and South and Central America Region’s financial market could be a soft target as a likely vehicle for money laundering due to a lack of automation.  Countries in the Region and elsewhere are concerned about money laundering and the financing of terrorism because that environment attracts an invasive human and corporate element that will destroy the community, the city, and the country.

Whether or not you like the regulations,   you have the capability to comply.  The solutions seem more menacing than the problem, and the cost seems too great, but compliance is an absolute necessity. Not complying is injurious to the financial integrity of your institution and its correspondent relationships, increases the potential for fines, and ultimately causes a destabilizing of the national monetary system putting the economy in disarray with the potential for international sanctions.

It is a difficult problem with an even more difficult answer to the critical success factors namely:

  • Understanding and implementing an AML/CFT/KYC risk-based program
  • Creating new policies and procedures
  • Managing and enforcing those policies
  • Periodic review of every member as needed
  • Capable of being used online or in-branch
  • Training staff on policies concerning the risk-based program
  • Managing and enforcing those policies
  • Retaining and managing the event data
  • Reporting the data in an informative way when required to the FIU/UAF and the Correspondents
  • Automated proof of following the risk-based program for the regulators, FIU/UAF, and correspondents

RiskCALM4 eliminates the problem and simplifies your solution by providing:

  • An automated AML/CFT/KYC risk-based program
  • Automated vetting of every new member during the account opening process
  • Dynamic automatic review of member base against Sanctions List
  • Automatic periodic review of members against Sanctions List
  • Automatic member risk rating
  • Transaction monitoring
  • Automated documentation that evidences adherence to relevant  policies and risk-based AML/CFT/KYC program
  • Automatic event data repository
  • Data managed with lineage and use designation with timestamp
  • The capability to automatically document and communicate the process to your correspondent institution, regulators, and FIU/UAF
  • Automatic policy management and enforcement
  • Credit risk modeling, Market risk modeling, Operational risk modeling
    • The importance of risk modeling, including a true IFRS 9 Credit Risk Model, is that AML/CFT is also pertinent to lending. A risk-based program for lending is necessary if you are to be in compliance with an AML/CFT risk-based program.  Regulators are discovering more attempts to launder money via the purchase of expensive property.  To have a model that can be used to identify the predictability of such an event, you must have automation, controlling data management and policies.  IFRS 9 risk-based program is important to your correspondent relationships.
  • Qualitative analysis
  • Automated FIU/UAF reporting
  • Complete audit trail
  • Automated loan processing and account opening, online and in-branch
  • Automated, dynamic loan and deposit documentation

 RiskCALM4 will also help with the challenge of vetting all existing members by:

  • Automating the vetting process via an online portal that will provide a convenient way for a member to share:
    • Updated data for identification
    • Photos or PDFs of identification such as Passports, Driver’s License, National ID Cards
  • Members using the online portal will be rewarded with exclusive promotional offers
  • Minimize the vetting time within your branch to a face to face verification
  • Updated data will be used to:
    • Vet against Sanction and PEP lists
    • Identify FATCA or CRS requirements
    • Confirm that data and documentation provided is within policy or note policy exceptions

Explore how it works!

Additionally, explore the benefits of providing more member services through:

  • Promotions
  • eCommerce
  • Community outreach
  • Increased revenues

RiskCALM helps financial institutions manage risk, automate governance, manage data, and create and monetize social networks.

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