Clear requirements for the implementation, maintenance, and development of the elements of the internal control system of AML/CFTP and management of sanctions risks (MSR) are established in the internal procedures of market participants.
The recommendations in the AML Licensing Guidelines are not exhaustive. The Guidelines include general principles, additional industry-specific commentary, and examples of good and bad practices. A detailed explanation with practical examples for creating an internal control system of AML/CFTP and MSR is available in the AML Guidelines of Latvijas Banka.
The content of the Guidelines
- Risk assessment
- Risk management strategy and governance culture
- Governance, including cooperation with third persons
- Procedure for reviewing alerts in the customer due diligence process
- Transaction monitoring process
- Process of identifying and reporting suspicious transactions to the competent authorities
- Provision of information technology (IT) systems for AML/CFTP and management of sanctions risks
- Procedure for ensuring an independent audit function, including procedure for evaluating the effectiveness of the internal control system
- Management of sanctions risks (MSR)
- Policies and procedures