Ongoing monitoring

When reviewing your AML documentation, there are some key areas you should focus 

Policy Implementation:

Reviewing your firm’s internal policy controls and procedures ensures that your documentation aligns with current legislation. New regulations can be introduced within a year, so it’s essential to adapt your firm’s policies accordingly. This process also helps confirm your understanding of the legislation, allowing you to correct any misunderstandings or clarify requirements.

Maintaining accurate, up-to-date documentation also has direct implications for your client base. If a client’s needs have changed since your last review, or if you’ve taken on new clients whose requirements fall outside your existing policies, this review presents an opportunity to incorporate those changes. By doing so, you’re staying compliant and supporting your clients more effectively.

Client Monitoring Requirements: 

Reviewing their information regularly lets you record any changes in their circumstances or business dealings. This helps establish a clear baseline of expected behaviour, making recognising unusual activities that may warrant further investigation easier. The depth and frequency of your reviews should match the client’s risk profile and level of due diligence, ensuring that more complex or higher-risk clients are monitored more closely.

It’s also essential to distinguish between routine ongoing monitoring and the additional measures taken under enhanced due diligence procedures. While ongoing monitoring involves periodically reviewing the client’s profile and ensuring their documentation is accurate, ongoing transaction monitoring focuses specifically on examining individual transactions. This allows you to identify patterns, spot irregularities in their transactions, and respond promptly to potential risks.

Record Keeping: 

Record-keeping is essential from both a risk and audit standpoint. Your firm’s documentation should be clearly labelled, securely stored, and easily accessible to staff. It’s also vital to demonstrate when each record was last updated, which can be done through timestamps on the original documents. Ensuring all client-related data—such as identification, risk assessments, risk determinations, and any updates—are thoroughly documented will help show that your client records remain accurate and up-to-date since their onboarding.

Technology and Controls: 

AML compliance involves various human elements, which means human error can occur. The controls section of your policies and procedures is designed to meet compliance standards and safeguard against human and technological errors. When conducting a review, it’s essential to examine your controls closely. This may help you identify staff not following procedures correctly or uncover technology issues that need attention. By reviewing manual work for accuracy and updating your firm’s controls to address any weaknesses, you can maintain the integrity of your compliance framework.

Conclusion: 

Effective AML compliance requires a firm-wide commitment to ongoing vigilance and regular review of procedures. Success depends on creating a culture where compliance is everyone's responsibility, not just the MLROs. Regular updates, monitoring, and documentation ensure that your firm maintains robust protection against money laundering risks while meeting regulatory requirements. Remember that AML compliance is not a static achievement but a dynamic process requiring continuous attention and improvement.

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