Through the Circular, CySEC informs the Regulated Entities that the Joint Committee of the three ESAs, published on 26.06.17 its final guidelines on AML and CFT (the “guidelines”). These guidelines:
- are essential to the European Union’s fight against ML/TF, as they set clear, regulatory expectations of the way credit and financial institutions should discharge important AML/CFT obligations and pave the way for a more effective and proportionate European AML/CFT regime that is consistent with international best practice and guidance;
- are based on mandates in Articles 17 and 18(4) of Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of ML or TF;
- promote a common understanding of the risk-based approach to AML/CFT and set out how it should be applied;
- are part of the ESAs’ wider work on fostering a consistent and effective approach to AML/CFT by both credit and financial institutions, and AML/CFT supervisors;
- provide credit and financial institutions with the tools they need to make informed, risk-based decisions on the effective management of individual business relationships and occasional transactions for AML/CFT purposes;
- provide guidance on the factors credit and financial institutions should consider when assessing the ML and TF risk associated with a business relationship or occasional transaction. In addition, they set out how credit and financial institutions can adjust the extent of their customer due diligence measures to mitigate the ML/TF risk they have identified.
Competent authorities will use these guidelines when assessing whether the ML/TF risk assessment and management systems and controls of EU credit and financial institutions are adequate.
Consequently, the ESAs will keep these guidelines under review and update them as appropriate. A first update is foreseen once amendments to Directive (EU) 2015/849 have been agreed.
CySEC’s expects that: The Regulated Entities shall take duly account and read ESAs Risk Factors Guidelines (accessible here), which will apply from 26.06.18 onwards.