AUSTRAC has published draft guidance on outsourcing that will apply to businesses that use outsourcing arrangements to help them meet their anti-money laundering and counter-terrorism financing (AML/CTF) obligations.
The draft guidance identifies:
- AML/CTF obligations when outsourcing
- money laundering and terrorism financing (ML/TF) risks that could arise from outsourcing
- steps to ensure providers tailor outsourcing arrangements to their business and its specific ML/TF risks.
The guidance emphasises that businesses are responsible for any breach of their AML/CTF obligations under outsourcing arrangements and should therefore have appropriate oversight of their providers.
The guidance provides examples of good practices when using outsourcing arrangements, and examples of practices that may lead to non-compliance and increase ML/TF risks to a business.
Outsourcing means engaging an external provider to help you meet your AML/CTF obligations, for example:
• reporting to AUSTRAC
• developing and maintaining your AML/CTF program
• carrying out an independent review of you AML/CTF program
• carrying out applicable customer identification procedures
• employee due diligence, AML/CTF risk awareness training and transaction monitoring.
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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
