SUMMARY FOR THIRD PARTY SUPPLIERS

Transcription

1 Anti-Mney Laundering and Cunter Terrrist Financing SUMMARY FOR THIRD PARTY SUPPLIERS RATIONALE Grup Plicy Ratinale This Plicy has been designed t assist in managing the risk f Mney Laundering, Terrrist Financing and the financing f the prliferatin f weapns f mass destructin which are serius threats t security and the integrity f the financial system. The verall risk includes the fllwing risk drivers: Failure t cmply with legal and/r regulatry respnsibilities in relatin t Anti Mney Laundering and Cunter Terrrist Financing; Failure t deter and detect thse wh wuld seek t use the Grup t facilitate the mvement f criminal funds and funds designed t finance terrrism In additin, this Plicy has been designed t supprt cmpliance with the fllwing legislatin and / r regulatins: Prceeds f Crime Act 2002; Anti-terrrism, Crime and Security Act 2001; The Mney Laundering, Terrrist Financing and Transfer f Funds Regulatins 2017; Cunter Terrrism Act 2008; and System and Cntrl (SYSC) Rules f the FCA Handbk. The Anti-Mney Laundering & Cunter Terrrist Financing Plicy (the AML/CTF Plicy) is a mandatry requirement fr all businesses, divisins and legal entities within the Grup and applies t all clleagues (temprary and permanent) in all jurisdictins in which the Grup perates. The Plicy clearly articulates a set f minimum standards and requirements that meet and ften exceed UK regulatry and legislative bligatins and the guidance prvided by the Jint Mney Laundering Steering Grup (JMLSG). Custmer Impact The Grup s visin is t be the best bank fr custmers. The Grups Anti Mney Laundering and Cunter Terrrist Financing Plicy (AML & CTF) supprts this visin with the aim f prviding investrs with strng, stable and sustainable returns by helping t maintain the financial stability f the Grup. The Plicy als gives ur investrs and custmers cnfidence in the strength and integrity f the Grup s cmpliance with legal and regulatry requirements. This is achieved by prviding: Clarity n the Grup s Anti Mney Laundering and Cunter Terrrist Financing Plicy and risk appetite, ensuring that the Grup minimises the risk f its prducts and services being used t launder the prceeds f crime r fund terrrism; Guidance n the risk-based training prgramme which allws clleagues t serve its custmers in line with AML & CTF legislatin, regulatin and the Page 1 f 6

2 Grup s risk appetite; and Guidance which allws Business Units t implement internal prcesses and cntrls including apprpriate Custmer Due Diligence, effective custmer screening and transactin mnitring prcesses. SCOPE An external party supplying services t the Grup r perfrming services n the Grup s behalf will be expected t cmply with the Grup s AML/CTF Plicy where thse services frm part f the Grup s regulated activities. In all ther circumstances, this Plicy is nt applicable t third-party suppliers f gds r services t the Grup. Typical circumstances that will result in this Plicy being applicable include the fllwing services: On-barding r intrducing custmers; Prcessing custmer transactins; Prviding the Grup s financial prducts t custmers; and Prviding risk, cmpliance r audit services t the Grup. Typical circumstances that will nt result in this Plicy being applicable include: Prviding gds t the Grup; Perfrming services unrelated t the Grup s regulated activities (e.g. security, transprt, catering, printing, etc.); and Cnducting activities utside the scpe f Regulatin 8 f the UK Mney Laundering, Cunter Terrrist Financing and Transfer f Funds Regulatins 2017 (r equivalent). MANDATORY REQUIREMENTS GENERAL The supplier must cmply with any anti-mney laundering bligatins t which they are subject in their wn right, fr example, by virtue f their falling within the scpe f Regulatin 8 f the UK Mney Laundering, Cunter Terrrist Financing and Transfer f Funds Regulatins 2017 (r equivalent). The supplier must nt engage in any cnduct that results in it, r anther party: cncealing, disguising, cnverting r transferring criminal prperty r terrrist funds; entering int, r becming cncerned in an arrangement that facilitates the acquisitin, retentin, use r cntrl f criminal prperty r terrrist funds; r acquiring, using r pssessing criminal prperty r terrrist funds. Where the Supplier is supplying a service t Llyds Banking Grup r perfrming a service n behalf f the Grup that frms part f the Grup s regulated activities and fr which Llyds Banking Grup retains AML/CTF accuntability, the Grup will define fr the supplier the specific requirements f the AML/CTF Plicy relevant t that service. This may include sme r all f the fllwing: Assessment f mney laundering and terrrist financing risk; Custmer Due Diligence / Onging Custmer Due Diligence (including frwarding CDD material upn request); Transactin Mnitring; Suspicius Activity Reprting; Page 2 f 6

3 Respnding t Curt Orders; Prvisin f Management Infrmatin; Staff Training; and Recrd Keeping. In all cases, Llyds Banking Grup will perfrm nging mnitring, versight and assurance f the supplier s activities t ensure cmpliance with the AML/CTF Plicy. KEY CONTROLS Cntrl Title Cntrl Descriptin Frequency Anti-Mney Laundering & Cunter Terrrist Financing Training 1. AML/CTF training prgram in place. 1. Annual review r any changes in applicable regulatin/legislatin. Third Parties must ensure that all staff cmplete Anti Mney Laundering and Cunter Terrrist Finance (AML&CTF) Training at least annually. Cmpletin f New t Bank Custmer Due Diligence (CDD) including Enhanced Custmer Due Diligence (EDD) (where applicable) Third Parties must ensure CDD is in place t cver all aspects f CDD and EDD (including beneficial wners) in line with the requirements f prevailing Mney Laundering Regulatins. Onging Custmer Due Diligence (ODD) Infrmatin: Overall number f staff expected t cmplete annual training; Number f staff wh have cmpleted annual training. 1. Sample checking f New t Bank CDD recrds. Infrmatin: Number f accunts pened; Number f accunts sampled; Number f failures e.g. where the crrect level f due diligence cannt be evidenced. 1. Sample checking f ODD recrds. 2. Quarterly Mnthly Mnthly Third Parties must cnduct nging mnitring f custmer relatinships t ensure existing recrds remain up t date. Infrmatin: Number f accunts subject t ODD review; Number f ODD cases sampled; Number f failures e.g. where cmpletin f ODD cannt be evidenced r is incmplete. Plitically Expsed Persns 1. Custmer screening 1. Screening must be Page 3 f 6

4 (PEPs) Third Parties must have apprpriate systems and prcedures t identify where a new r existing custmer relatinship (including beneficial wner) is a PEP. Suspicius Activity Reprting (SAR) Third Parties must ensure that where knwledge r reasnable knwledge exists that a persn has been engaged in mney laundering r has identified that criminal/ terrrist prperty exists the Third Party must ensure that a suspicius activity reprt is made t the Llyds Banking Grups (LBG) Nminated Officer. Recrd Keeping Third Parties must ensure that requests fr infrmatin relating t CDD including transactinal data must be retained in accrdance with prevailing regulatin (Mney Laundering Regulatins 2017) and retrievable upn request within agreed timescales. Gvernance An individual must be appinted within the Third Party wh has primary respnsibility fr the Anti Mney Laundering and Cunter Terrrist Finance cntrl framewrk. must be in place t identify PEP's at new t bank (NTB) r where an existing relatinship may becme categrised as a PEP. infrmatin: Number f PEP relatinships identified. 1. Suspicius activity reprts - Prcedures must be in place that prvides a mechanism fr reprting internal suspicin when perating in the curse f business. Infrmatin: Number f suspicius activity reprts raised. 1. Prcedures in place that ensure dcumentatin is retained (whether physical r electrnic) are accurate, legible and kept fr an agreed perid f time. It must include the mechanism fr retrieval t agreed timescales. infrmatin: Number f instances where requests fr infrmatin have nt been met. The appinted individual must ensure that: 1. Dcumented plicies and prcedures in relatin t AML&CTF are maintained and meet regulatry and legislative bligatins. perfrmed: NTB within 24 hurs; Existing custmers - daily screening. 2. Mnthly. 1. Prcedures reviewed at least annually 2. Mnthly. 1. Prcedures reviewed at least annually. 2. Mnthly. 1. Annual review r any change in applicable regulatin / legislatin. Page 4 f 6

5 infrmatin is prduced that prvides details n levels f cmpliance and identifies where remedial actin is required. Management infrmatin must include the level f cmpliance against the fllwing: 2. Mnthly. > Staff training; > CDD; > ODD; > PEPs; > SARs; > Recrd keeping. 3. An independent versight and mnitring prgramme is in place; 4. Gvernance arrangements are in place that ensure the escalatin f management infrmatin and results f versight and mnitring prgramme t the Third Parties Senir Management and LBG (as agreed) allwing fr the effective management f ML/TF risks in a timely manner. MANDATORY REQUIREMENTS NON-COMPLIANCE Any material differences between the requirements set ut abve and the supplier s wn cntrls shuld be raised by the Supplier with Llyds Banking Grup s Supplier Manager. The Supplier Manager will then discuss the nn cmpliance with the Accuntable Executive fr the relatinship and lcal Risk team t agree way frward. Versin Number Effective Date August August September 2016 Page 5 f 6

6 June September 2018 Next Planned Revisin: September 2019 Page 6 f 6