Aspida Insights

Amendments to Proceeds of Crime Law – Consultation

Carrie Tullier Compliance Associate

The GFSC released, on 28th March 2023, a consultation on proposed amendments to Schedule 3 of the Criminal Justice (Proceeds of Crime) (Bailiwick of Guernsey) Law, 1999 and associated rules and guidance in the Handbook on Countering Financial Crime and Terrorist Financing (the Handbook) . The focus of this consultation is on three areas:

  • to introduce a requirement for firms to establish an independent audit function to test the adequacy and effectiveness of the firm’s policies, procedures and controls for AML/CFT;
  • to introduce a requirement for a firm’s business risk assessment to consider the money laundering and terrorist financing risks to their business presented by the main predicate offences identified within the BailiwickC’s national risk assessment; and
  • to develop the regulatory framework for virtual assets service providers, to include information requirements for virtual asset service transfers, the introduction of a £1,000 threshold on virtual asset transactions over which customer due diligence will be required, and for the definitions of ‘funds’ and ‘property’ to specifically include virtual assets.

Factors for firms to consider when determining whether to adopt an independent audit function include:

  • operating in NRA indicated high-risk sectors
  • customer risk profiles
  • size and nature of their business
  • Changes to the business ML and FT risk factors including acquisitions, integrations, significant or recurrent breaches identified through previous audit or CMP.

Where firms opt not to adopt an independent audit function they must clearly document what the reasons are for making this decision and review it annually.

Maintaining independence of audit function, particularly within smaller firms, can pose significant difficulties.

The consultation closed on 25th April 2023.

Aspida can help firms to consider appropriate audit frequency and scope and can assist in targeted, themed or full independent audit services dependent on the nature, size and risk profile of clients.

At Aspida we have a team of highly experienced audit, risk and compliance professionals who can offer fully independent audit services, from testing CMP remediation activities to quality assessment and independent audit reporting. 

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