AMLCFT Risk Assessment Mitigation Policy

Introduction

  • This Anti-Money Laundering & Combating the Financing of Terrorism (AML/CFT) Risk Assessment and Mitigation Policy (AML/CFT RAM Policy) sets out the framework which VFD Microfinance Bank Limited (VFDMFB or the Company) shall apply in identifying the degree of potential Money Laundering/Terrorist Financing (ML/TF) risks associated with specific customers and transactions in order to ensure focused monitoring of t    hose customers and transactions that potentially pose the greatest risks of ML/TF.
  • VFDMFB adopts a risk-based approach that is commensurate with the specific risks of money laundering and terrorism financing. Higher money laundering risks demand stronger controls. However, all risks, whether low, medium or high, must be mitigated by the application of necessarycontrols such as the implementation of appropriate customer due diligence, verification and monitoring procedures that are proportionate to the identified ML/FT risks that the financial institution is exposed to from its Customers, products and countries that it transacts business with.
  • This AML/CFT RAM Policy applies to all of VFD MFB’s Personnel. You must read, understand and comply with this AML/CFT RAM Policy when processing transactions with Customers. This AML/CFT RAM Policy sets out what we expect from you for the Company to comply with relevant ML/FTlaws.
  • This AML/CFT RAM Policy is an internal document and cannot be shared with third parties, Customers or regulators without prior authorisation from the Company.
  • Unless otherwise expressly defined herein, the definitions set out in the AML/CFT Policyof VFDMFB are incorporatedin this AML/CFT RAM Policy.

 

Scope

  • The Personnel of VFD MFB, its board of directors, management and every person working for VFDMFBare required to adhere to this AML/CFT RAM Policy to protect VFDMFB and its reputation from being misused for money laundering and/or terrorism financing by ensuring they discharge their responsibilities in a manner that enables full implementation of this AML/CFT RAM Policy.
  • VFD MFB shall apply this AML/CFT RAM Policy to its relationships with its counterparties or partners.
  • Specifically, the AML/CFT RAM Policy shall be incorporated into the operations of business marketing, business origination, market regulation, financial control, as well as any other relevant departments within VFD MFB.
  • VFDMFB shall review this AML/CFT RAM Policy from time to time, as is required.
  • Please contact the Company with any questions about the operation of this AML/CFT RAM Policy, or if you have any concerns that this policy is not being or has not been followed.

 

Purpose

The purpose of this AML/CFT RAMPolicy is to:

  • Provide guidance for identifying the degree of potential ML/TF risks associated with specific customers and transactions in order to ensure focused monitoring of those customers and transactions that potentially pose the greatest risks of ML/TF.
  • Provide an internal risk assessment and mitigation policy for VFD MFB.
  • Provide guidance on the standards of conduct and practice that must be followed in the implementation of the KYCand CDD requirements of a financial institution.
  • Protect VFDMFBagainst fraud, reputational and other financial market risks.
  • Minimise the risks ofVFDMFB inadvertently processing proceeds of crime.
  • Protect the integrity of the financial market against all forms of abuse, fraudulent and unfair trade practices.
  • Comply with relevant rules and regulations of the CBN.

 

VFD AML/CFT Risk Assessment

This section identifies a range of risk factors that help to identify the ML/TF risks associated with VFDMFB as a provider of payment services to Customers.

Generally, attempts to conduct illegal activities through VFDMFB may come from many different sources throughout the system. Certain services, Customers and geographic locations in which VFDMFBoperates may be particularly vulnerable or may have been historically used by criminals for ML/TF activities.

There are two parts of VFD MFB’s risk assessment, namely; (i) the Enterprise Wide Risk Assessment (EWRA); and (ii) the Customer Risk Assessment (CRA). Both the EWRA and the CRA are two pieces of the same puzzle and are intertwined to create the foundation for a strong and successful compliance program at VFD.

The Enterprise Wide Risk Assessment (EWRA)

  • The EWRA identifies the risk of financial crime posed to VFDMFB on a firm-wide scale and some of the EWRA risk factors include:
    • Delivery Channel;
    • Customer Risk;
    • Geographic Risk;
    • Transactional Risk;
    • Product and Services Risk; and
  • VFD MFB’s EWRA is set out below.