A government has instituted a new anti-money laundering laws which require all financial institutions to obtain certain information from its customers. Which step should an institution located in…

The correct answer is B. Change procedures and systems as necessary and provide employee training. According to the CDD Rule, covered financial institutions must establish and maintain written procedures that are reasonably designed to identify and verify beneficial owners of legal entity customers and to include such procedures in their anti-money laundering compliance…

AML/CFT Compliance Programs

Question

A government has instituted a new anti-money laundering laws which require all financial institutions to obtain certain information from its customers. Which step should an institution located in this jurisdiction take to ensure compliance?

Options

AChange procedures to require that the necessary information is obtained
BChange procedures and systems as necessary and provide employee training
CSend a notice to customers asking them to provide the necessary information
DChange systems to ensure the required information is automatically obtained from all customers

How the community answered

(23 responses)

A
4% (1)
B
78% (18)
C
13% (3)
D
4% (1)

Explanation

According to the CDD Rule, covered financial institutions must establish and maintain written procedures that are reasonably designed to identify and verify beneficial owners of legal entity customers and to include such procedures in their anti-money laundering compliance program. These procedures should also be updated as necessary to reflect changes in the law or the institution's risk profile. Moreover, the institution should provide adequate training to its employees on the new requirements and monitor their compliance.

Topics

#compliance program#regulatory change#employee training#systems update

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