The nature of the supervisory response will be informed by the following:
- Ongoing monitoring. Review and assessment of the financial institution's AML/CFT measures to ensure that they remain effective in mitigating the identified risks. This will involve, among others, conducting periodic assessments of the financial institution's risk profile, reviewing its AML/CFT policies and procedures, and sampling its customer and transaction data.
- Offsite and onsite activities. Appropriate balance of resources and efforts between offsite and onsite supervisory activities in line with the risk profiles of the financial institutions. The scope and intensity of these supervisory activities will also be based on the assessed risks.
- Offsite activities generally focus on identifying and assessing an institution’s ML/TF/PF risks, though they may also include broader AML/CFT-related topics.
- Onsite activities typically involve assessing the level of AML/CFT compliance, but they can also serve to gain deeper insights into an institution’s risk management practices.
- Periodic re-assessment. Adequate follow-up by the supervisory authority of any new facts or developments within a financial institution or sectors that may impact on the ML/TF/PF risks for the financial institution or sector, a structured dialogue with supervised institutions’ management, and outreach sessions and feedback meetings with a financial institution or the sector as a whole.
