NIC / FIC Launch Money Laundering Guidelines

The National Insurance Commission (NIC) and the Financial Intelligence Centre has collaborated to organized a seminar on Anti-money Laundering/Combating financing of Terrorism (AML/CFT) guidelines for insurers in Ghana recently, B&FT enumerates some of the main issues. Following the enactment of the Anti-Money Laundering Act, 2008 (Act 749), the Anti-Terrorism Act, 2008 (Act 762) and the subsequent passage of the Anti-Money Laundering Regulations, 2011 (L.I. 1987), Ghana is now giving necessary attention to fight against money laundering and terrorist financing. The benefit of the Anti-Money Laundering Act will not be realized unless there is effective implementation of the collaborative measures being adopted by the National Insurance Commission (NIC) and the Financial Intelligence Centre (FIC) as well as compliance by licensed insurance practitioners. It is against this background that the NIC and FIC in accordance with section 6(d) of Act 749 and Regulation 38 of L.I. 1987 developed this guideline for the insurance practitioners licensed by the National Insurance Commission. The guidelines have incorporated essential elements of the AML Act and Regulations, relevant FATF-recommendations, the sound practices of the International Association of Insurance Supervisors (IAIS) and other international best practices on Anti-Money Laundering and the Combating of the Financing of Terrorism (AML/CFT). To provide a further guide and to avoid ambiguity, the guideline on KYC is also provided to assist insurance practitioners in their implementation guidelines. Purpose and overview of the guidelines Money Laundering has been defined as the process whereby criminals attempt to conceal the illegal origin and/or illegitimate ownership of property and assets that are the fruits of the proceeds of their criminal activities. It is, thus a derivative crime. Financing of Terrorism (FT) is defined here to include both legitimate and illegitimate money characterized by concealment of the origin or intended criminal use of funds. Money laundering and terrorist financing are global phenomena and there has been growing recognition in recent times, and indeed well-documented evidence, that both money laundering and terrorist financing pose major threats to international peace and security which could seriously undermine Ghana�s development and progress. Consequently, concerted global efforts have been made to check these crimes. Insurance practitioners, in particular, have come under sustained regulatory pressure to improve their monitoring and surveillance systems with a view to preventing, detecting and responding effectively to the threat of money laundering and terrorist financing. The guidelines cover the following key areas of AML/CFT policy; Reporting Officer designation and duties; the need to co-operate with the supervisory authority; customer due diligence; monitoring and responding to suspicious transactions; reporting requirements; record keeping; and AML/CFT employee training program. Insurance practitioners are exposed to varying money laundering risks and serious financial and reputational damage if they fail to manage these risks adequately. Diligent implementation of the provisions of this guideline would not only minimize the risk faced by licensed insurance practitioners of being used to launder the proceeds of crime but also provide protection against fraud and reputational and financial risks. In this connection, the affected institutions are directed to adopt a risk-based approach in the identification and management of their AML/CFT risks. Ghanaian insurance practitioners are also reminded that AML/CFT laws in all the jurisdictions in which they operate should not only designate money laundering and predicate offences but should prescribe sanctions for non-compliance with the relevant laws and regulations on customer due diligence, non-rendition of prescribed reports and not keeping of appropriate records. It is, therefore, in their best interest to entrench a culture of compliance which would be facilitated by the guidelines.