What is the importance of a risk-based approach (RBA) and building controls commensurate with risks?

The correct answer is A. An RBA allows organizations to adopt a more flexible set of measures and to use resources more. A Risk-Based Approach (RBA) allows financial institutions to allocate compliance resources effectively and prioritize higher-risk areas for enhanced due diligence (EDD). Option A (Correct): An RBA enables institutions to tailor their AML controls based on risk exposure…

AML/CFT Compliance Programs

Question

Options

AAn RBA allows organizations to adopt a more flexible set of measures and to use resources more
BAn RBA makes it easier for organizations to implement controls faster to counter all applicable
CAn RBA is internationally accepted by customers and stakeholders, making it a more appropriate
DAn RBA more clearly dictates which resources are to be used to control an organization's overall

How the community answered

(24 responses)

A
75% (18)
B
17% (4)
C
4% (1)
D
4% (1)

Explanation

A Risk-Based Approach (RBA) allows financial institutions to allocate compliance resources effectively and prioritize higher-risk areas for enhanced due diligence (EDD). Option A (Correct): An RBA enables institutions to tailor their AML controls based on risk exposure, ensuring better resource allocation.

Topics

#risk-based approach#proportionate controls#resource allocation#AML flexibility

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