AML/CTF Independent Review

Scenario:

A listed credit provider was required to have its AML Program independently reviewed by an AUSTRAC approved auditor.

Outcome:

AML Experts was engaged and using the Lexcel AML Independent Review Methodology, all legal obligations and compliance requirements were captured. Improvements in the AML/CTF Program were recommended and accepted.

AUSTRAC Enforceable Undertaking Independent Review

Scenario:

A court enforceable undertaking to change business practices in a defined time frame led the money-remitter to AML Experts. Failure to make the changes would result in closure of the business and possible court action against the owners.

Outcome:

Paddy Oliver was assessed by AUSTRAC as a suitable independent subject matter expert and conducted an independent review of the business. His report outlined the changes required. He conducted a second review after implementation and AUSTRAC was satisfied the business was operating legally. The business now flourishes.

Money Laundering/Terrorist Financing Risk Assessment

Scenario:

The Australian branch of a global financial services company required an assessment of its risk to ML/TF. An internal assessment was unsophisticated and potentially in breach of the AML Act.

Outcome:

Using the Lexcel ML/TF risk assessment methodology, Paddy Oliver worked with the client to identify the ML/TF risks in the business. The business and regulatory risks were addressed and the client now has greater risk controls within its operations and is meeting its regulatory obligations.

Advice on AML Act and AML/CTF Program Writing

Scenario:

A stockbroking firm had a new product which made it easier for clients to open and run an account. This required an AML Program review before a major bank would approve the product.

Outcome:

AML Experts conducted three rounds of gap analysis in the client’s AML Program against the Act. Improvements were made after each round, with bank approval granted after the third.

Response to AUSTRAC S202 Notice

Scenario:

A money remitter received an S202 Notice which had serious consequences for its business if not dealt with correctly.

Outcome:

In the expert opinion of Paddy Oliver, the S202 had been issued in error and the less onerous S167 Notice was applicable. After delicate negotiations, AUSTRAC agreed and altered the Notice to a S167. Paddy then assisted the client with a detailed response to both the S202 (in pro forma) and S167 Notices.

This outcome was very favourable to the client especially invoking the self incrimination defence under S169.

Helping a FinTech meet its AML obligations and to reduce operational costs

Scenario:

FinTech startup providing superannuation and deposit type product. Caught by AML Act and further contractual obligations from a banking supplier. They needed assistance with ML/TF risk assessment, AML Program, and advice on electronic verification of customers

Outcome:

Worked with client to provide a proposal with several options around advice and assistance for a fixed price. The client chose the option for a ML/TF risk assessment workshop. We provided a template ML/TF risk framework. After the client had carried out an initial assessment we facilitated a 3 hour ML/TF risk assessment workshop with the client.

The workshop covered the client’s risk appetite as well as risk mitigation strategies. The discussion on risk appetite was particular informative for the client which provoked wider discussions on risk.

AML Program Re-Write Project

Scenario:

The reporting entity, a large Australian financial institution, had a compliant AML Program. However, the AML Program had become lengthy and rather disorganised over the years as it had never been re-written, only added to. The project was to revise and re-write the AML Program into a shorter and more readable document but not compromising its compliance with the AML Act and Rules.

Outcome:

The project was in two phases. Phase 1 was a full gap analysis of the AML Program all relevant AML Rules (Rules 4 - KYC, 8 - AML Programs, 15 - Ongoing Customer Due Diligence). Phase 2 was the AML/CTF Program re-write.

After identifying the gaps we commenced re-writing the Program. This involved taking operational processes out of the Program and placing them into an Operational Procedures Document to allow these procedures to be changed without Board approval.

Part A was re-written to allow non material changes to Operational Procedures to be carried out by the AMLCO with pre-approval of the Board. This will allow ever changing Operational Procedures to be changed without changing the AML Program with the requirement to have the new Program approved at every stage by the Board.

Three documents were produced: Part A; Part B; and Operational Procedures. Each was drafted by Paddy Oliver of AML Experts then reviewed by the client project steering committee.

Use was made of online collaboration tools to ensure best use of client time.

The project was completed to a fixed price and agreed timescale. As a value add to the client we also advised on the new elements of Rule 4.15 relating to identification of individuals.

Know Your Customer Processes Re-Engineering

Scenario:

A digital currency (crypto) exchange client had a pre AML Act commencement KYC process which included verification of identity from a photograph of a customer's driver licence or passport plus several other verification controls. After DCEs became regulated by the AML Act the DCE wanted to ensure that this process was retained and was compliant with AML KYC Rules.

Outcome:

Starting from the pre AML Act process we worked with the DCE to map this process against the AML Rules. After the mapping the process was considered to be nearly compliant with the new KYC rules however some adjustments to the process would be needed to ensure full compliance. Working with the client we assisted with the re-engineering of the KYC processes (for individuals and non-individuals) and the re-writing of the AML Program to ensure compliance.

The key to this project was that DCE wanted to ensure that verification was from an "authenticated" photographic identification document. That was achieved. As was re-rewriting the AML Program to include the documentation and electronic verification risk assessments.

All was achieved on time and on budget.