Amendment to the FSC AML/CFT Code

A risk based approach[1] –

(i) Identifies that risks related to money laundering and financing of terrorism differ across customers, countries and territories, products and services and delivery channels;

(ii) Allows licensees to understand the nature of the customer based on its vulnerabilities in a way that matches its risk;

(iii) While having minimum standards, allows licensees to apply adequate internal controls and system, commensurate with the nature of its activities and arrangements; and

(iv) Assist licensees in the allocation of resources for the prudential conduct of business.

Licensees must also consider any additional measures they wish to adopt to prevent them and their services from being used to launder money or to finance terrorism.

The FSC has already adopted a Risk-Based Supervisory Framework, which caters for both compliance-driven supervision and risk-based supervision.

The AML/CFT Code has been amended to include the features of the Guidance Note issued by the FATF for an effective supervisory system with the aim to enhance the understanding of the relevant FATF requirements.

[1] Wolfsberg Statement, Guidance on a Risk Based Approach for Managing Money Laundering Risks, 2006