Money Laundering Regulations 2017—identifying and assessing organisation-wide risks

The following Risk & Compliance practice note provides comprehensive and up to date legal information covering:

  • Money Laundering Regulations 2017—identifying and assessing organisation-wide risks
  • Do you have to conduct a risk assessment?
  • Risk assessment and the risk-based approach
  • The risk assessment pyramid
  • What are appropriate steps?
  • Statutory categories of risk
  • Sources of information—external
  • EU supranational risk assessment
  • National risk assessment
  • Sector specific risk assessment and guidance
  • More...

Money Laundering Regulations 2017—identifying and assessing organisation-wide risks

This Practice Note explains the regulatory requirement to identify and assess organisation-wide risks as set out in the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017), SI 2017/692, as amended. It provides guidance which is of general application. You should check whether the MLR 2017 contain additional or varied requirements for your sector and whether your regulatory body has any additional, sector specific requirements in relation to risk assessment.

There is no right or wrong way to conduct a risk assessment; just ensure you are thorough. Look at what you do, and what you do not do.

But no matter how thorough your risk assessment or how appropriate your controls, some criminals may still succeed in exploiting your practice for criminal purposes. A comprehensive and documented practice-wide risk assessment, combined with written records of decisions made on individual customers and matters will enable you to justify your decisions and actions to law enforcement agencies and your supervisory authority.

Do you have to conduct a risk assessment?

If the MLR 2017 apply to your organisation, you must take appropriate steps to identify and assess your organisation's money laundering and terrorist financing risks. For a sample risk assessment, see Precedent: Money laundering and terrorist financing organisation-wide risk assessment.

Risk assessment and the risk-based approach

You should not

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