Independent audit function to test the program

  • The audit must be carried out by people not involved in the AML program, who report directly to the board of directors or to a designated board committee comprised of more than half outside directors. Auditors should be qualified to perform the audit.

  • The audit should cover:

    • Adequacy of risk assessment, CCD policies, procedures and processes

    • Adherence to the above

    • Testing of high risk transactions (i.e. high risk products/services/customers/locations)

    • Adequacy of training

    • Compliance with laws and regulations

    • Integrity and accuracy of AML systems

  • Assess suspicious activity monitoring by:

    • Evaluating policies and procedures

    • Reviewing the system’s method for identifying suspicions

    • Evaluating the reports produced

    • Checking any filtering criteria

    • Where systems are not used, a review of the manual transactions should check that large or suspicious transactions were appropriately dealt with

    • Evaluate how suspicious transaction reports (STRs) are researched and evaluated

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