Prevention of money laundering, terrorist financing and other criminal offences is a major challenge for many credit and financial services institutions due to the constantly growing regulatory requirements as well as the special focus by supervisory authorities. The German Money Laundering Act (GwG) was repeatedly amended and further tightened as part of the implementation of the 5th EU Anti-Money Laundering Directive on 1^st of January 2020.

Current challenges:

• Implementation of new requirements according to the amendment of the German Money Laundering Act (GwG) on 1^st of January 2020, among others:
  • The provisions to obtain evidence about information regarding the beneficial owner in the transparency register, to verify this information and in case of deviations to submit a discrepancy report require an enhancement of the KYC process.
  • The scope of the enhanced due diligence requirements was extended to transactions, in which a party with residence in a high-risk country is involved. In addition, the extent of enhanced due diligence measures for customer relationships / transactions with involvement of a party with residence in a high-risk country was increased. These adjustments require a regular update / enhancement of the IT-Monitoring applications as well as the enhanced due diligence process.
• Increased workload in daily operations due to tightened requirements, for example:
  • Increased extent of enhanced due diligence activities for customer relationships / transactions with involvement of a party with residence in a high-risk country
  • Increased number of alerts in IT-Monitoring applications, which require a prompt and proper processing.
• Enhancement of the quality of KYC-processes and KYC-information to comply with the regulatory requirements which are subject to special focus of supervisory authorities, auditors and internal audit due to the upcoming FATF assessment of Germany.
• Digitalisation, for example of the KYC-process and KYC-data, offers many opportunities to combat money laundering and terrorist financing more efficiently. At the same time, the adaption and implementation of related process and IT-systems represents a major challenge for credit and financial services institutions in practice. In addition, some digitalised banking products and services like cryptocurrencies bear the risk to be misused for money laundering or terrorist financing and hence need to be considered in the prevention measures in a proper way.

Our services:

BDO has specialists, who have extensive expertise from various audits and advisory projects regarding prevention of money laundering, terrorist financing and other criminal offences of credit and financial services institutions, to help you meet these challenges. Our services concern in detail:

• Support of the implementation of new anti-money laundering requirements
• Analysis and optimization of KYC-processes as well as corresponding written rules of procedures and IT-applications regarding compliance with anti-money laundering requirements
• Analysis and remediation of KYC-data and documents (KYC remediation)
• Review and preparation of AML Risk Analysis: Identification, Analysis und Assessment of business-specific AML Risks
• Support of daily business operations (e.g. execution of enhanced due diligence of customer relationships, handling of IT monitoring alerts etc.)
• Execution of control- and review activities as well as performance / support of internal audit function
• Trainings regarding prevention of money laundering, terrorist financing and other criminal offences for Money Laundering Reporting Officers and respective employees
• Analysis of the possibility to digitalise processes regarding prevention of money laundering, terrorist financing and other criminal offences

Contact us. We are happy to inform you about our comprehensive project experiences, present you detailed information about our services and analyse how we can provide you best possible support.

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