On 6th March, the Basel Committee on Banking Supervision (BCBS), the Committee on Payments and Market Infrastructures (CPMI), FATF and the Financial Stability Board (FSB) welcome the Correspondent Banking Due Diligence Questionnaire recently published by the Wolfsberg Group, as one of the industry initiatives that will help to address the decline in the number of correspondent banking relationships by facilitating due diligence processes.  The questionnaire aims to standardise the collection of information that correspondent banks ask from other banks when opening and maintaining these relationships, such as their ownership, the products and services they offer and their programmes for AML/CFT as well as compliance with sanction regimes and anti-bribery and corruption (ABC) programmes. The questionnaire is also part of a co-operative effort by the public and private sectors to recognise KYC utilities as an effective and efficient tool to support due diligence processes.

The questionnaire is at –

FATF notes that it has taken initiatives to make sure that the application of AML/CFT measures does not contribute to de-risking.  In order to clarify regulatory expectations, the FATF published guidance on correspondent banking services, and risk-based approach guidance for money and value transfer services, which emphasise that financial institutions should identify, assess and understand their ML/TF risks, and mitigate them, on a case-by-case basis. The FATF guidance on private sector information sharing also encourages greater collaboration and sharing of information within and among financial institutions.

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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