What Is An AML Compliance Officer?

An AML compliance officer simply ensures that your organization is in compliance with the Federal Decree-Law No. (20) of 2018. In order to ensure that your entity’s internal policies and procedures regarding anti-money laundering remain compliant with relevant laws and regulations, credit unions, banks, and other similar financial institutions, it is essential that you prioritize the appointment of a qualified AML officer.  

As part of the strategy to combat financial crimes such as money laundering and financing of terrorism, governments and law enforcement agencies all across the globe require financial and other similar institutions to develop and implement AML compliance programs. In order to ensure compliance with the relevant AML rules and regulations, it is highly important for an institution to appoint a Compliance Officer that will be responsible for overseeing the development and implementation of the institution’s AML policies, procedures as well as overall program.

The senior management within an organization should take into account the following factors when appointing an AML Officer.

What are the Responsibilities of an AML Compliance Officer?

While, all the employees within an entity should be aware about their entity’s AML policies and processes but a compliance officer with an entity is mainly responsible for ensuring the implementation of policies and processes related with the AML at an institutional level. His main focus should be monitoring the internal controls and systems that an organization has put in place to identify and report activities relted with any sort of money laundering during all the stages of money laundering. In simple words, the job of a compliance officer is to make sure that his company is not subject to the risk of criminal activities.

The responsibilities of an AML officer vary from country to country. However, AML programs are often mirrored by entities working in different countries, and the duties of an AML Officer include the following:

• Assisting the development and implementation of the AML program within the company.
• Ensuring that the company is complying with the existing AML rules and regulations.
• Automating the AML compliance of the company.
• Developing and implementing a risk assessment framework for services, products, clients, and other issues relating to money laundering.
• Conducting third-party audits and inspections, and making recommendations based on the results of those audits and inspections.
• Maintaining documents and records of all the clients, and reporting any suspicious transaction and activity to the relevant authorities.
• Reporting to the entity’s senior management on matters connected with internal AML compliance policies and controls.
• Implementing and monitoring an AML training program for all the employees.

Appointing an AML Officer

A compliance officer is required to have complete knowledge as well as the appropriate skills in all the areas of financial policies and procedures, and in the methodologies of financial crimes. When appointing an AML officer, it is highly important that the senior management selects a candidate who not only has the expertise to carry out the given responsibilities efficiently and effectively but also who suits the company’s unique needs and requirements.

The ability and commitment of a compliance officer will help in shaping up the AML program, and reflect the commitment of the company towards combating financial crimes such as money laundering and financing terrorism activities. Keeping that in mind, the following factors should be taken into consideration when appointing a suitable candidate for the position of the compliance officer:

Expertise and Training

A compliance officer must have adequate understanding and appropriate experience with regards to the regulatory compliance, risk management strategies, and the overall financial landscape. This understanding and experience should go beyond internal AML controls and systems, and extend to methods of money laundering, and to the potential risk posed by specific clients and suppliers.   

The AML compliance is a continuously changing field, so your AML Officer’s knowledge and skills should reflect the existing compliance and regulatory climate. Keeping that in mind, many educational institutions are offering AML training and certification to equip you with the requires skills set.

Time and Focus

Take into account the administrative burden your compliance officer will face within the entity – and make sure that they are given the time and resources to perform their tasks efficiently and effectively. Large scale entities, with much greater administrative burden, will be required to hire a full-time employee with the primary focus on compliance with relevant money laundering laws and regulations, but small scale entities can outsource AML compliance services.

Authority and Confidence

Given the legal impact of AML compliance, it’s important that an AML officer has the authority to ensure the company’s compliance with all the relevant laws and regulations. An AML officer’s responsibility is not only to oversee and handle a variety of financial information / data of the company, but also to communicate with the top level management and the board, and with the regulatory authorities on a regular basis.