The complete guide to meeting your AML/CFT obligations

All reporting entities must meet their obligations under the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (hereafter referred to as the AML/CFT Act). Reporting entities should not take this obligation lightly as the penalties for non-compliance are massive and can be as high as $2m and/or up to two years in prison.

The requirements

The AML/CFT Act 2009 (Act) requires a Reporting Entity (RE) to:

  • Put in place a Risk Assessment identifying the risks to its business from money laundering and financing of terrorism crimes, and develop an AML/CFT Programme based on that Risk Assessment describing the steps it will take to mitigate the risk of money laundering and financing of terrorism; and
  • Undertake an audit of the Risk Assessment, and the AML/CFT Programme through an appropriately qualified person who is independent and who has not been involved in the development of the reporting entity’s AML/CFT Risk Assessment, or the establishment, implementation or maintenance of its AML/CFT Programme.

Meeting AML/CFT obligations is not a five minute task. There may be significant work that needs to be undertaken for all those involved – the level of work being dictated by the size of the business and outcome of the business’ risk assessment.

Strategi Group's AML/CFT solutions

Obviously, you cannot have the same service provider assisting you in developing your Risk Assessment and the AML/CFT Programme, and then auditing the same. This raises the question: who will you appoint to be your independent auditor and who will you seek professional help from to implement the Risk Assessment and the AML/CFT Programme?

Strategi Group can help you make the best, and easiest, decision by splitting your AML/CFT obligations between two service providers. Strategi Group comprises two distinctly separate legal entities: Strategi Institute Limited (Strategi Institute) and Strategi Limited (Strategi) both perfectly positioned to help you meet your obligations.

Strategi Ltd can be your AML/CFT auditor

There is a legal requirement to appoint an independent auditor to undertake the compulsory two-yearly AML/CFT audit. Strategi Ltd has specialist compliance staff who are able to conduct your AML/CFT audit. However, this can only occur if Strategi Ltd was not engaged as a consultant to help you meet your AML/CFT obligations.

Strategi Institute can train your compliance officer and staff on AML/CFT

A comprehensive manual with templates has been developed by Strategi Institute and is a complete guide for those who need to meet AML/CFT obligations. This manual – complete with appendices and checklists – is designed specifically for small to medium-sized businesses who are deemed to be reporting entities.

This manual can be provided in either hard copy or electronic format and includes:

  • A very detailed guidance note explaining what your obligations are and providing you with tips and instructions on what you are required to do and how to do it.
  • A checklist for completing and assessing your risk assessment.
  • A checklist for completing your AML/CFT programme.
  • A sample template of a risk assessment for a simple reporting entity that is deemed to be ‘low risk’.
  • A sample template of an AML/CFT programme for a simple reporting entity that is deemed to be ‘low risk’.
  • A worksheet to use when completing your risk assessment.
  • Appendices that provide the detailed background information that you need to help you understand what risks your business might face and the implications of those.
  • Information on how to undertake customer due diligence (CDD) and identity verification.
  • What is involved in the compulsory AML/CFT audit (every two years, or at any other time your AML/CFT supervisor requires), things you need to consider before you appoint an auditor to undertake your AML/CFT risk assessment and programme audit, and suggestions on who to appoint.

What is the investment?

The cost of getting it wrong is far in excess of the investment in the AML/CFT manual, the training packages and the compulsory two-yearly audits. Pricing for a small to medium-sized reporting entity is shown below:

Item Benefit Investment (ex GST)
AML/CFT manual and templates End to end solution to enable you to complete your risk assessment and AML/CFT programme plus learn what your obligations are

$475 - $590 depending on entity type

Strategi Institute AML/CFT annual refresher training package including assessment Meet the training requirements contained in your AML/CFT programme plus your requirements under Code Standards 14 & 15

From $35 (free for Radar subscribers)

2-yearly AML/CFT audit from Strategi Meet the legal requirement to have an ‘independent’ auditor

$1,200 – $1,900 depending on type of audit

Next steps

See our articles, publications and reviews under the topic AML/CFT to find out more, or contact us for more information or to discuss your requirements.