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FMA published Requirements for Internal Governance in the Fight against Money Laundering and Terrorist Financing

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Today, on 19 March 2019, the Austrian Financial Market Authority (FMA) published its new FMA Circular “Internal Organisation for the Prevention of Money Laundering and Terrorist Financing”. This circular is intended to further enforce the internal governance with regard to the prevention of money laundering and terrorist financing. The requirements are not restricted to activities in Austria. There is a focus on requirements throughout the entire group for entities that are internationally active. Banking groups and groups of financial institutions performing international business from Austria are required to measure and manage the risks of money laundering and terrorist financing throughout the group. They are responsible for ensuring that effective strategies and controls are implemented throughout the entire group and therefore their business units in other countries, that are comparable to the prevailing standards in Austria. FMA Executive Board Members Helmut Ettl and Klaus Kumpfmüller remarked: “This circular underpins our active role in the battle against international money laundering and terrorist financing. For a number of years we have not only checking the precautions taken in Austrian parent institutions, but we also conduct on-site inspections of international business units. It is essential for the integrity of our financial centre that Austrian financial undertakings also do not display any weaknesses in their international business.”

The function of the Anti-Money-Laundering Officer is an important part of the governance. As both an internal and external contact person has a central role in the practical implementation of due diligence for the prevention of money laundering and terrorist financing. The function is to be established in such a way that it reports directly to the management body. As a key function holder the Anti-Money-Laundering Officer is required to possess the required expertise and have a good personal reputation.

Furthermore the circular also contains detailed statements about to what extent the function of the Anti-Money-Laundering Officer, or the duties to be performed for satisfying due diligence obligations for the prevention of money laundering and of terrorist financing may be outsources, and what must be considered in legal terms.

The circular is addressed to all financial market participants who are subject to the Financial Markets Anti-Money Laundering Act (FM-GwG) and supervision by the FMA. It supplements the circular published in December 2018, in which the FMA has presented details about the practical implementation of due diligence obligations in accordance with the FM-GwG. For undertakings these publications contain clear and specific regulatory and supervisory rules that provide additional legal clarity in practice.

The circular can be downloaded (in German only) here.


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