The Company policies and procedures include onboarding of new clients and ongoing requirements through the termination of relationship, along with the forms to be completed, documents collected and individual responsible.
No clients/customers are accepted from countries considered high risk.
All clients are required to obtained referrals from regulated entities. High risk clients/customers profile require the compliance officer to sign off and are reported to the Board of directors. Potential Extreme risk clients are refused and reported to the board of directors.
Training exceeds the standard annual AML training for the Compliance Officer. Updates are forwarded to the staff members, along with current cases. Specific training covers Regulators’ Rules. P&P updates, and risk rating frame work is filed with the regulator.
Before onboarding any relationship, and periodically thereafter, each client relationship must be risk rated. Using the point system, outlined in the methodology, each identified risk is rated low, medium or high which equates to 1, 2 or 3 points respectively.
RESIDUAL RISK | LOW | MEDIUM | HIGH |
Allocated Points | 1 | 2 | 3 |
The points from each factor are totaled, and the sum reference to a scale. Depending on where the total points fall on the scale, the relationship is classified as Low, medium or high risk and extreme.
Risk rating points
RATING POINTS | CLIENT RISK RATING |
0–7 | Low |
8–15 | Medium |
16–20 | High |
20 and Over | Extreme |
Once the client/customer relationship has been risk rated, this determines the level of on-going due diligence
RISK PROFILE | DUE DILIGENCE | REVIEW FREQUENCY |
Low | Simplified | Every 5 years |
Medium | Additional KYC | Every 3 years |
High | Enhanced | Every year |
Extreme | None | None |
However, risk rating may change as factors, risk tolerance, controls and methodology changes.
In accordance with the established levels of residual risk, rating and corresponding CDD, Appendix 2 will be used to periodically review the client’s/customers relationship to the Company. The outcome of the review will inform any action to be taken.
In all interaction with the client, employees are to be aware of the client profile and ensure adherence, updating as new information is received and reporting any suspicious interaction to the MLRO. In addition, the periodic review takes note of all information relating to a client over a time period, which may reveal a pattern or context.
All client’s accounts are monitored for the stated account purpose, therefore monitoring is ongoing. Any request which does not meet the client profile and for which no reasonable explanation is obtained, would be registered as a triggered event and recorded in the unusual transaction report, to be followed up by the Supervisor.
Should the unusual transaction or any transaction, according to the Company’s policies and procedures, is observed to be suspicious, it must then be reported to MLRO, who in turn will determine whether or not a report need be filed with the FIU.