Anti-Money Laundering Compliance
Objectives and Guidelines
Fransabank Group’s AML/CFT (Anti-Money Laundering/Combatting the Financing of Terrorism) Policy primarily aims at setting, within the Group, the essential standards for fighting money laundering operations and terrorism financing. Should the applicable AML/CFT laws and regulations of any country or jurisdiction require higher standards, Fransabank Group’s overseas subsidiaries and associate banks must conform to those standards. However, in case the relevant subsidiary and associate come across any applicable law that is inconsistent with the Group’s policy, they must refer to the Group’s Anti-Money Laundering Department to resolve the conflict.
This Policy also encompasses the following objectives:
• Promoting a “Know Your Customer” standard as a cornerstone principle for Fransabank Group business ethics and practices;
• Developing an effective internal control structure where no business with a customer is performed without obtaining all the required information relating to the customer;
• Consolidating within the Group, the AML/Combatting of Financing of Terrorism (CFT) efforts deployed by the Fransabank entities;
• Conducting self-evaluation processes on the compliance with the AML/CFT policy and measures.
Consequently, the adoption of this policy is crucial to ascertain that all Fransabank Group’s entities, whatever their geographic location, fully comply with the enacted AML legislation. The Group is committed to overseeing its AML/CFT strategies, objectives and guidelines on an ongoing basis, and supporting an effective AML/CFT Policy within the Group’s business.
Anti-Money Laundering – Combatting Terrorist Financing Policy Statements
Customer’s Due Diligence and Know Your Customer
- Prior to any transaction of any type, Fransabank Group’s entities gather and document the relevant customer identification data, along with the background information, the purpose and the intended nature of the business.
- Fransabank Group’s entities retain and document any additional customer information, relevant to the assessment of the money laundering risk by adopting a risk-based approach.
Additional Due Diligence Measures for Financial Institutions
Fransabank Group’s entities engage to take the following additional due diligence measures while establishing and maintaining correspondent relations:
- Gathering sufficient documentary evidence on a respondent institution, to avoid any relationships with “shell banks”;
- Enquiring about the good reputation of a respondent institution from public sources of information, including whether it has been subject to a Money Laundering or Terrorist Financing investigation or other regulatory action;
- Verifying, on a periodic basis, that the respondent institution is implementing sufficient and effective procedures to fight Money Laundering and Terrorist Financing.
Monitoring and Reporting of Suspicious Transactions/Activity
- Fransabank Group’s entities apply due diligence measures whenever they detect any unusual or suspicious transaction or activity, taking into account the legal framework of the concerned institution.
- All suspicious transactions or activities complying with the laws and regulations of the corresponding jurisdiction are reported.
- The Group’s AML Department is notified of all suspicious transactions or activities when doubts arise.
Fransabank Group made a clear decision to cooperate for the implementation of the United States' Foreign Account Tax Compliance Act (FATCA) and reached a deep understanding of the new regulations and their impact on the business cycle, in addition to the position of the Group in the financial environment. In this context, Fransabank, with its local entities, implemented important measures to ensure a smooth roll-out of this process:
- Establishment of a FATCA steering committee presided by the General Manager, with a main objective to define and deal with the process key challenges;
- Creation of a project team to successfully navigate the challenging implementation of FATCA phases;
- Implementation of new KYC onboarding procedures to identify US account holders among new and existing customers;
- Adaptation of dedicated AML systems to enable information gathering, storage and searching for US indicia;
- Organization of FATCA awareness sessions lectured by the head of the AML Department to senior employees, aimed at ensuring understanding, readiness and capabilities in addressing related requirements;
- Development of KYC procedures in light of FATCA Proposed Regulations and Internal Revenue Services (IRS) announcements, as well as required amendments are underway to include major changes outlined in the Final Regulations.
Highly committed to a culture of compliance to AML/CFT standards, the AML Department was able to streamline its monitoring activities, in order to tackle and strictly abide by increasing and challenging sanctions requirements. In fact, the AML Department shifted its monitoring activity from rules-based to risk-based approach, by implementing tighter preventive measures on a certain category of customers with a high-risk line of business and on cross-border transactions. On the other hand, a new Know Your Client (KYC) version that empowered the Customer Information Program and paved the way for a full compliance with the risk-based approach requirement came into force in October 2012.