Control is a critical and complex management function capable of preventing conflicts with the external and internal environment. All possible changes (internal or external) should be identified in advance and certain steps should be taken to minimize their impact on the business.
In this blog article we will share tips where attention needs to be paid in order for your internal control system to be effective:
There is no doubt that each company, despite its similarity to other companies in the industry, has its own unique internal environment: employee competence, IT infrastructure, owner's risk appetite, products, sales/supply channels, etc. That is why it is worth investing in the self-assessment of your company's ML/TPF and sanctions risk, so that the "shoes" are not only beautiful, but also in the right size.
Apply a risk-based approach to ensure that the client due diligence efforts are focused on identifying and managing specific risks, and that due diligence requirements are adequate and appropriate, and proportionate to the risk. Namely, ask where the bear got the honey from, not the bees.
Efficiency can only be improved for a process that is detailed, standardized and measurable. Write a procedure for checking the risk-based approach to customers and partners in your company, decision-making, documenting the information obtained during the check and reporting the suspicious transaction. If you have not properly documented your research, get ready to prove you are not a "donkey".
Before starting cooperation, researching the client is a fairly standard thing, as curiosity and a desire to learn all possible information about the new client appears. On the other hand, conducting research during cooperation requires a certain discipline. Automate the screening of ongoing clients and partners against the mandatory sanctions lists and set the date of the client's next due diligence based on the client's risk level. It should be remembered that regular due diligence of customers and partners reduce the risks of ML/TPF and sanctions and have a positive impact on your business.
Prepare a list of useful links and external consultants to contact with questions and/or requests for enhanced due diligence. Such a list will be worth its weight in gold when there is not enough information, but you need to make a quick decision in changing circumstances.
Remember that an effective internal control system helps to distinguish between the different changes according to the nature of their impact, for example, events that could have a negative impact are called "risks", and events that could have a positive impact are called "opportunities" and maintain a balance between these events.
Atbilst team
