Commentary

A7.120 Money Laundering Regulations—policies, controls and procedures

Administration and compliance

A7.120 Money Laundering Regulations—policies, controls and procedures

A7.120 Money Laundering Regulations—policies,      controls and procedures

In order to prevent activities relating to      money-laundering and terrorist financing, a 'relevant person'      (A7.115) must establish and maintain      policies, controls and procedures to mitigate and manage effectively the risks      of money laundering and terrorist financing identified in any risk assessment      undertaken by the relevant person1. They      must also regularly review and update those policies, controls and procedures,      and must maintain a record of them in writing (as well as a record in writing of      any changes to them, and any steps taken to communicate the policies, controls      and procedures or any changes to them within the business)2. They must, where relevant, be      communicated to their branches and subsidiaries located outside the United      Kingdom3.

The policies, controls and procedures must be proportionate with regard      to the size and nature of the relevant person's business (and so taking into      account is risk assessment      under regulation 18, see A7.116, as well as any guidance issued by      the Financial Conduct Authority or any other supervisory authority or      appropriate body and approved by the Treasury) and must be approved by its      senior management4. They must      include:

  1.  

    •     risk management practices

  2.  

    •     internal controls

  3.  

    •     customer due diligence

  4.  

    •     reliance and record keeping,

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