THE Securities and Exchange Commission (SEC) is calling on investment houses, financing and lending companies, among others, to accomplish an anti-money laundering and combating the financing of terrorism (AML/CFT) inherent risk assessment data form (AIRDF).
“A risk-based approach to Anti-Money Laundering or Combating the Financing of Terrorism would ensure that the appropriate measures commensurate to those risks are taken in order to mitigate them effectively,” the SEC said.
The regulator said this is so it can “assess the [money laundering or terrorist financing] risks to which covered persons are exposed and understand their AML/CFT risk profile.”
Securities brokers, dealers, and underwriters, investment houses or mutual fund distributors, eligible dealers for government securities, REIT (real estate investment fund) managers, financing firms, and lending companies are required to accomplish the form.
The AIRDF should be accomplished by Oct. 15 and the report will cover the period ending 2020. A link to the AIRDF may be accessed through a link on the SEC’s website.
The report will check on an entity’s products and services, customer profile, its delivery and financial channels, as well as the geographical location of its customers and other parties related to its transactions.
“Failure to comply shall constitute a violation of an order of the Commission implementing a risk-based approach to supervision as provided for in SEC Memorandum Circular No. 26, Series of 2020,” the commission said.
According to the memorandum circular, violations may lead to monetary fines, the issuance of a permanent cease-and-desist order, the suspension or revocation of a firm’s certificate of incorporation. The SEC may also dissolve the corporation or forfeit assets, among others. — Keren Concepcion G. Valmonte