HCS Bank

USE OF FINANCIAL
INTERMEDIARIES
FAS D2 1
FINANCIAL
INTERMEDIARIES
• Institutions for customer acquisition
• Housing Finance Companies
• AMC’s
• Insurance companies
• Stock Exchanges
2
RISKS INVOLVED

• Compliance
• Financial
• Business continuity
• Reputational
• Operational
• Cyber
• Strategic

3
RISK MITIGATION

1 2 3
Onboarding Monitoring Continuation/
Termination

4
5
 DUE DILIGENCE

• Alignment of business objectives, strategy and/or plan

• Ownership structure, business model, target clientele and reputation
• Have or build up capacities to mobilize internal resources
• Compliance with regulations and policies for AML/CFT requirements
• Adequate risk management policies, operating systems and processes

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 SYSTEMS AND PROCESSES

• Review policies, procedures and internal audit reports to gauge ML/TF risk mgt
• Background searches and adverse news screening of connected parties
• Set up dedicated team within compliance and audit to facilitate FI relation
• Development of internal policies, procedures and controls
• Employee training program
• Delegation of CDD to FI only after assurance of compliance with AML/CFT standards

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FINANCIAL
DUE DILIGENCE

8
 MONITORING

• Statement of procedure
• Risk based assessment
• Periodic review and background checks
• Circumvention in legal and regulatory requirements
• Suspicious transaction reporting to FIU
• Updated assessment records and FI’s license/regulatory status
• CDD delegation review to include assessment of measures and standards of CDD
• Independent function for review and approval process
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 CONTINUATION/TERMINATION

 Future collaboration depends on performance review and

assessment
 All reviews and assessments to be properly documented

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 ANY
QUESTIONS ?

Phone: Email: Website:

+65 216 555-0011 fasd2@hcsbank.com www.hcsbank.com 11
 REFERENCES

• https://www.bstdb.org/GuidelinesAppraisalSelectionFI.pdf
• https://www.fatf-
gafi.org/media/fatf/documents/recommendations/pdfs/FATF%20Recommendations%202012.p
df
• https://www.adb.org/sites/default/files/institutional-document/479716/financial-
intermediaries-technical-guidance-note.pdf

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