The board of directors is the primary governing body of an institution.
In order to execute their duties effectively, directors need to understand the business, have sufficient knowledge of the specific AML risks posed to the business and also understand the regulatory environment in which the business operates.
That does not imply that directors are expected to be AML compliance experts. Although ultimate responsibility for the RMCP rests with the board of directors, their role consists of oversight; the day-to-day management of the program rests with the designated MLCO.
It is the board of directors or senior management who must create a culture a of compliance within the accountable institution, ensuring that the institution’s policies, procedures and processes are designed to limit and control risks of money laundering and terrorist financing and are fully consistent with the law and that staff adhere to them.
The shift in the FIC Act to make board of directors and senior management accountable is not only desirable but obligatory.
The tone is set at the top.
Being FICA compliant is but one part of doing business ethically and doing business ethically sits at the top and should filter down the institutions. So, sending the right message to staff members on the FIC Act compliance culture in an organisation, is a must for any accountable institution.
The shift demands that directors and senior management get up and observe.
If staff members are questioned by the Centre during compliance inspections, what will staff members reveal about your institution’s AML and Counter Terrorist Financing (CFT) compliance culture?
Leaders (Boards of directors and senior management) should invest in the right people who has the right attitude.