“Supervision with a Risk-Based Approach for Financial and Non-Financial entities” discussed in Peru

money bills drying, illustrating money laundering“Supervision with a Risk-Based Approach for Financial and Non-Financial entities” was the theme of a workshop aimed at the Andean sub-region held between 2 and 5 May in Lima, Peru. The GAFILAT-EU Project funded the participation of Ecuador, Bolivia, Chile and Colombia. Nevertheless, the invitation was open to all the GAFILAT membership, with participants coming from two more countries (Nicaragua and the Dominican Republic), and representatives from the host country (Peru). The event was organized jointly with the Banking and Insurance Supervision Authority (SBS) of Peru.

This was an interesting activity to work in cross-cutting issues regarding the implementation of the Risk-Based Approach in the Money Laundering/Financing of Terrorism (ML/FT) preventive system, in order to weight and understand the ML/FT risks by the supervisors, as well as the financial institutions and Designated Non-Financial Businesses and Professions (DNFBP) which attended the workshop.

The Financial Intelligence Units and the SBS of Peru provided presentations, along with the GAFILAT Executive Secretariat and the Latin American Banking Federation (FELABAN) to a total of 83 participants.

The first day of the workshop counted with the presence of representatives from the private sector to address the relevant international standards, to hear a presentation on the Risk-Based Approach to the Banking Sector and the Guidance for a Risk-Based Approach to Life Insurance, both documents issued by the FATF. Two dialogues between the private sector and relevant authorities were held, for the Banking and Micro-financing sector as well as for the Insurance and Securities Sectors. Likewise, simplified/enhanced Customer Due Diligence (CDD) measures and screening with a risk-based approach were addressed topics.

During the second day, the session consisted of an analysis of the features of an effective system. Furthermore, the principles for an adequate supervision of financial institutions were analysed, including operational aspects on the monitoring and supervision of financial institutions and DNFBPs.

For the third and last day of the workshop consisted of a dialogue between the private and public sector, with special emphasis on DNFBP, working on topics such as the identification and assessment of the RBA, factors to be considered by DNFBP and best practices among countries, which involve measures that the DNFBP should implement on its customers (CDD, screening and filing of Suspicious Transaction Reports). Additionally, the role of DNFBPs in the identification of the beneficial owner was discussed.