AML/CTF – Anti-Money Laundering and Countering the Financing of Terrorism

Framework and governance review

You have some concerns about the robustness of your existing AML/CTF framework or you are facing challenges in ensuring its proper implementation.

We can assist you by: 

• Designing and reviewing your policies and procedures, including gap assessments to ensure full compliance with AML/CTF rules and tax compliance obligations, taking into consideration the specifics of your industry and any group policy and standards
• Reviewing and assessing the  adequacy of your operating model,  control, and governance framework, ensuring appropriate allocation of the roles and responsibilities across different lines of defense

Risk assessment and risk-based approach

Navigating the complexities of defining your risk appetite, implementing a risk-based approach, and accurately assessing and managing risks can be challenging.

We can assist you by:

• Designing and reviewing your ML/TF risk appetite, including implementing relevant KPIs/KRIs
• Reviewing, drafting and tailoring a risk-based approach specific to your organisation
• Designing and reviewing your risk assessment methodology
• Completing your annual risk assessment and subsequent reporting
• Designing and reviewing your country risk assessment methodology, including ongoing maintenance and updating of country risks

In addition to our knowledge and expertise, we also offer automated and digitalised solutions to better accompany you. For Investment Funds and Investment Fund Managers, we have developed a specific digital risk assessment tool to facilitate the risk assessment process.

Training and awareness programme

Staying up-to-date with continuous changes and updates in legal and regulatory requirements at international and national level can be challenging. If you need tailor-made training and the latest industry insights, we can assist you by:

• Preparing a newsletter on a quarterly basis, providing you with a summary of the key AML/CTF legal and regulatory changes at international and national level
• Delivering training sessions to your employees or Board of Directors, including e-learning modules

AML/CTF compliance support and assistance  (including secondment)

Experiencing a shortage of AML/CTF resources at various levels of seniority and expertise in your first or second line of defence can lead to significant delays and backlogs due to activity overload or system-generated backlogs.

We can assist you by:

• Providing AML/CTF, tax and legal experts to address all AML compliance needs including, but not limited to:
  • completion of annual AML/CTF questionnaires and market entry forms
  • review and preparation of RC reports
  • drafting of policies and procedures
  • performance of KYC/Customer Due Diligence and Ongoing Due Diligence
  • assistance in addressing transaction/screening alert backlogs
  • assistance with goAML registration
  • and STR/SAR preparation
• Providing access to our AML/CTF hotline, where experts answer your AML/CTF queries on demand
• Offering AML/CTF-oriented legal assistance in drafting and reviewing prospectuses, issuing documents, subscription and application documents and service provider agreements as part of investment fund development or banking and insurance licensing

Health check, mock inspection

It remains essential to comply in an efficient way  with your AML/CTF obligations, maintain a proactive overview of your compliance framework and be prepared for any on-site visits from regulatory authorities.

We can assist you by:

• Performing a general suitability review of your AML/CTF internal control framework (including key policies and procedures, processes and governance documents) to determine adequacy against legal and regulatory obligations
• Preparing your company for visits from regulators: interview preparation, review of presentations for introductory meetings with Senior Management, review of key AML/CTF policies and documents, sample testing, etc
• Providing support  during on-site inspections

MLRO/RC services

You are an Investment Fund supervised by the CSSF or under the regulatory authority of the AED and facing the challenge of finding the right RC.

AIS can assist you by acting as RC and enabling you to fulfil your obligations, including, but not limited to:

• Implementing and/or monitoring the Fund’s compliance with AML/CTF policies and procedures  and with the AML/CTF legal and regulatory framework
• Preparing and updating the annual AML/CTF risk assessment
• Preparing periodic and ad hoc written reports to the management/Board of Directors
• Performing AML oversight on service providers (transfer agents, portfolio managers and distributors as needed)
• Preparing annual AML/CTF training for relevant persons (including RR)
• Preparing summary reports on the RC’s activities and operations, at least once per year
• Serving as the primary contact with the Luxembourg authorities for AML/CTF purposes and being registered with goAML (FIU)

Our team has extensive expertise in both CSSF and AED supervised vehicles, enabling us to handle mandates across a wide range of entities.

RBE/RFT services

Identifying the Ultimate Beneficial Owner (UBO) of entities, fiduciaries or trusts and ensuring accurate reporting can be challenging.

Our dedicated team of AML experts can assist you by:

• Identifying Ultimate Beneficial Owners and conducting related analyses
• Filing UBO-related information with the RBE or RFT to meet registration obligations under the RBE and RFT laws

AML/KYC as a managed service

Ensuring adequate due diligence measures at the entry into a business relationship, having up-to-date data and documentation and staying compliant vis-à-vis an ever-evolving regulatory landscape are key and continuous challenges that Investment Fund Managers, Investment Funds and Asset Service Providers need to address on top of their everyday activities. This concerns all relevant parties, such as investors, distributors, delegates and assets.

By combining our operational AML/KYC expertise with digital Investor Onboarding capabilities through our partnership with Fenergo, we can:  

• Facilitate your investor onboarding experience
• Manage the initial and ongoing due diligence process of your investors, distributors, IFM counterparts and assets
• Perform screening and ensure that the level of risk assigned is accurate and the level of due diligence is adequate
• Provide you with the status of the process by granting you access to our digital solution
• Enable you to monitor the activities that you have outsourced to us on a continuous basis

Screening and transaction monitoring assessment

You want to ensure that your screening and monitoring systems are efficient, fit for purpose and in line with legal and regulatory requirements. You may be facing significant volumes of false positive alerts and are uncertain about the definition of rules, parameters and scenarios, or have doubts about a transaction or relationship.

We can assist you by: 

• Reviewing and assessing potentially suspicious transactions and reporting to the FIU, including legal assistance regarding SAR/STR fillings and sanctions
• Assessing your current name screening/transaction monitoring tool setup (such as a review of parameters, scenarios, thresholds and data quality) and assisting you in implementing any corrective measures needed to improve efficiency
• Evaluating the effectiveness of the transaction monitoring process (treatment of hits, documentation, detection of AML/CTF typologies, overall monitoring during the relationship) and assisting you in the implementation of any corrective measures
• Designing and reviewing screening and transaction monitoring procedures, including gap assessments to ensure compliance with current AML/CTF rules, taking into account the specifics of your industry and your organisation.

Targeted Financial Sanctions (TFS) and Targeted Proliferation Financing (TPF) assistance

You have identified a person (natural or legal) as part of a business relationship or as part of a transaction or investment who is on TFS/TPF lists and you are uncertain whether or what to report to the respective authorities. You have failed to report or made a report too late and are in breach of your obligations and need assistance.

We can support you by: 

• Analysing the financial sanctions applicable to your business model (including sectoral sanctions and import/export restrictions)
• Revising internal procedures to ensure compliance with financial sanctions and amending contractual terms to meet the expected due diligence thresholds
• Evaluating your (reporting) obligations towards the Ministry of Finance and/or your regulator
• Handling any breach of financial sanctions
• Representing you in your interactions with the Ministry of Finance and/or your regulator
• Representing you in the event of private claims from counterparties affected by your enforcement of financial sanctions

Know Your Customer, Know Your Delegate, Know Your Asset

Knowing your counterparties prior to establishing a relationship or throughout the relationship is a top priority and you want to ensure that the measures in place are commensurate with the risks identified. In the case of delegates, you want to gain additional comfort about the framework and contractual agreement in place.

We can assist you by: 

• Conducting initial and ongoing due diligence on any counterparty
• Reviewing your existing approach, framework and contractual agreements to properly define roles and responsibilities in the case of delegated activities
• Reviewing a target’s AML/CTF framework during business pre-deal (buyer or seller) and issuing a specific due diligence report, as part of a merger & acquisition process

AML/CTF mitigation programme 

If you have been subject to an on-site visit from regulatory authorities and deficiencies have been identified, or if weaknesses need to be addressed based on outcomes from your internal or external auditors, we can assist you by:

• Responding to the regulatory authorities based on the outcomes of the inspection by defining a mitigation action plan to address identified shortcomings, including discussions with the regulators, and assisting you in the implementation of the plan
• Implementing corrective measures to address deficiencies identified in your control environment, following an internal or external audit
• Addressing shortcomings identified following a health check or a mock inspection

AML/CTF remediation exercise

When deficiencies are identified by regulatory authorities, internal or external auditors or due to changes in the legal and regulatory environment, it is crucial to address concerns about the adequacy of CDD measures and the KYC/KYT information and documentation obtained. You may be experiencing delays in the periodic AML/KYC review of your customer’s portfolio or need to perform a full AML/KYC review following the migration of a client portfolio.

We can assist you by: 

• Building a remediation approach that factors in your business model and specific characteristics, including the allocation of roles and responsibilities between the first and second lines of defence
• Implementing and executing this exercise, using a combination of subject matter expertise, project management, proper governance and automation

Internal/Regulatory investigation 

You are facing allegations of serious misconduct within your organisation and are looking for support with handling the investigations.

Arendt regularly represents Boards of Directors and companies during investigations into alleged wrongdoing and assists with designing adequate responses to the results of such investigations.

We can assist you in managing the aftermath of an internal investigation, including advising on dealings with regulators, revising and implementing remedial policies, procedures and training or acting for you in subsequent employment, civil or criminal litigation.

We are able to assemble, at very short notice, a multilingual and multidisciplinary team that is tailored to the scope of the investigation and trained to manage competing obligations relating to evidence gathering, data protection, employment, civil and criminal law, and regulatory duties.

Our forensic team provides efficient data gathering and review, as well as forensic financial analysis, where required. 

Criminal defence

The number of criminal investigations and prosecutions in the fight against money laundering is increasing, driven by international expectations and growing public awareness of financial crime.

In addition, the victims of offences such as fraud or embezzlement tend to turn against the regulated players who were supposed to control and block the financial flows to assert their claims for compensation when they are unable to identify or reach the perpetrator of the primary offence or to recover their money from them. They frequently choose, or threaten, criminal proceedings during settlement talks.

Criminal proceedings often take place alongside or in addition to administrative sanctions and can affect both natural and legal persons.

Many prosecutions concern breaches of professional obligations.

If you are subject to a dawn raid, or at risk of or subject to a criminal investigation, we are here to help and mobilise the appropriate teams at short notice.

Our criminal law team offers a full range of criminal defence services, in addition to support from other Arendt teams, particularly Banking, Regulatory and Forensic. Criminal proceedings are divided into several phases, each of which may be decisive for the outcome of the case. It is therefore important to make the right strategic choices from the outset and to assert the rights of the defence. Our experienced team of criminal defence lawyers is dedicated to providing robust legal representation, ensuring your rights are protected and your case is meticulously handled.