The Basel Committee on Banking Supervision has recently issued the updated version of its guidelines on Sound management of risks related to money laundering and financing of terrorism: revisions to supervisory cooperation, with guides on the interaction and cooperation between prudential and anti-money laundering and combatting the financing of terrorism (AML/CFT) supervisors for banks. These guidelines are intended to enhance the effectiveness of supervision of banks’ money laundering and financing of terrorism (FT) risk management, consistent with and complementary to the goals and objectives of the standards issued by the Financial Action Task Force (FATF) and principles and guidelines published by the Basel Committee.
The revisions set out principles and recommendations for information exchange and cooperation in relation to: (i) authorisation related procedures of a bank; (ii) ongoing supervision; and (iii) enforcement actions. Also, possible mechanisms to facilitate such cooperation in the jurisdictional and international context are provided.
Consistent with the goals and objectives of the standards issued by the Financial Action Task Force (FATF) and principles and guidelines published by the Basel Committee, the revisions provide further detailed guidelines to strengthen the interaction and cooperation between prudential and AML/CFT supervisors.
The revised guidelines include new paragraph 96 in Part IV (the role of supervisors) and Annex 5 (interaction and cooperation between prudential and AML/CFT supervisors). Annex 5 sets out specific principles, recommendations and descriptive examples, to facilitate effective and efficient cooperation in relation to authorisation related procedures of a bank, ongoing supervision, and enforcement actions. It also describes possible methods of implementation including mechanisms to facilitate such cooperation at the jurisdictional and international level.
The guidelines are not included in the Basel standards and are only applicable for those jurisdictions that choose to implement them on a voluntarily basis.
Source: the Bank for International Settlements (BIS)