AML/CTF Compliance Reviews: Is your reviewer independent?

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In early 2018, the AML/CTF Rules were updated to define what is meant by the ‘independence’ of a reviewer. Reporting entities must now be able to demonstrate the independence of a reviewer when organising an independent review of Part A of their AML/CTF Program.

Independence of a Reviewer

In assessing the suitability of a person to be an independent reviewer, a reporting entity should consider the following factors:

  • whether each reviewer is a member of a professional body that imposes relevant obligations on its members;
  • the measures taken to avoid the risk of “self-review”;
  • whether each reviewer is sufficiently free from influence by persons involved in the development of Part A of the reporting entity’s AML/CTF Program, or the reporting entity’s risk assessment, and
  • the adequacy of the reviewer’s understanding of, and expertise in applying, the obligations of the AML/CTF Act and Rules to the reporting entity.

Independent Compliance Reviews

An independent review can be conducted by an internal person or an external person. An independent compliance review should assess and test the effectiveness of your AML/CTF Program in addressing:

  • your ML/TF risks,
  • whether your AML/CTF Program meets the requirements of the AML/CTF laws,
  • how effectively your AML/CTF Program has been implemented; and
  • if you have been complying with your AML/CTF Program appropriately.

For further information on Independent Compliance Reviews, refer to our blog article titled ‘Is it time for an Independent AML/CTF Compliance Review?

For further information on ensuring your AML/CTF Program is compliant, refer to our blog article titled ‘Are you Meeting your AML/CTF Obligations? What to Include in your AML/CTF Program

Sophie Grace can assist you to update your AML/CTF Policy or conduct a full external compliance review in relation to your AML/CTF obligations.

If you would like any assistance with your AML/CTF obligations or wish to discuss the independence of a review further, please contact Sophie Grace directly.

About The Author

Ivana Josic

Ivana is responsible for all Marketing activities for Sophie Grace and assists both the Compliance and Legal teams with a particular focus on Compliance services. Ivana focuses on website development, management and ensures clients receive the latest regulatory updates through Sophie Grace social media channels, the newsletter and website blog page. Ivana also assists the Compliance team with drafting and amending compliance documentation, preparing AFSL and ACL Applications and implementing ongoing compliance solutions.

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