Where firms need to amend their controls in response to the current circumstances, decisions should be clearly risk assessed, documented and go through appropriate governance. However, in the current situation, we expect firms to make reasonable efforts to collect this information or consider whether there are other ways of being reasonably satisfied with the customer’s identity, before taking a decision to close the account. Where a firm is collecting information from an existing customer, Regulation 31 of the Money Laundering Regulations (MLRs) requires the account to be closed where the information is not provided. The challenges of detecting terrorist financing remain, and firms must not weaken their controls to detect such high-risk activity. there is a clear plan to return to the business as usual review process as soon as reasonably possible.the firm does so on a risk basis (for example, reviews for high risk customers should not be delayed unless absolutely necessary).We would consider such delays reasonable as long as: These could include ongoing customer due diligence reviews, or reviews of transaction monitoring alerts. However, we do recognise that, while continuing to operate within the legislative framework for anti-money laundering and counter terrorist financing, firms may need to re-prioritise or reasonably delay some activities. For example, firms should not change or switch-off, current transaction monitoring triggers/thresholds, or sanctions screening systems, for the sole purpose of reducing the number of alerts generated to address operational issues. While we recognise that the current climate may give rise to operational challenges in relation to financial crime systems and controls, firms should not seek to address operational issues by changing their risk appetite. This should include the timely reporting of Suspicious Activity Reports (SARs) of any new threats. It is important that firms remain vigilant to new types of fraud and amend their control environment where necessary to respond to new threats. We are already working with partners in law enforcement such as the National Economic Crime Centre (NECC) to share information on Covid-19 related financial crime, and will continue to do so as new risks emerge or as criminals change their approach. Those seeking to launder criminal proceeds or finance terrorism are likely to also exploit any weaknesses in firms’ systems. In the current climate, it is important for firms to maintain effective systems and controls to prevent money laundering and terrorist financing.Ĭriminals are already taking advantage of the coronavirus (Covid-19) pandemic to carry out fraud and exploitation scams through a variety of methods, including cyber-enabled fraud. Maintaining the integrity of the financial market is a key objective for the FCA. This statement will no longer apply from 7 February 2021.
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