In a move to revamp AML protocols, the Korea Financial Intelligence Unit (KoFIU) has announced its plan to Strengthen AML Responsibility and Expertise.
According to Kim & Chang, this plan is the culmination of about six months of extensive discussions with and input from financial companies, marking a pivotal moment in the financial regulatory sphere.
The core of KoFIU’s improvement plan revolves around two crucial aspects. Firstly, it aims to reorganize the roles and responsibilities of key personnel involved in AML operations. This reorganization targets the ambiguity in the responsibilities of the board of directors (BOD), management, compliance officer, and money laundering reporting officer (MLRO) as stipulated under the existing Act on Reporting and Using Specified Financial Transaction Information, its Enforcement Decree, and related regulations.
Secondly, the plan focuses on clarifying the expertise and independence requirements for MLROs. This move is designed to mitigate the limitations in the effective implementation of AML systems, which were previously hampered due to a lack of institutional mechanisms to ensure professional and independent execution of AML duties.
This transformative strategy will be incorporated into the amendment of the “Regulation on Anti-Money Laundering and Countering the Financing of Terrorism” (AML/CFT Regulation). The revised AML/CFT Regulation is set to be enforced in the first half of 2024, with a subsequent grace period of two years granted for the MLRO’s qualifications. This timeline indicates a proactive and forward-thinking approach by KoFIU in strengthening AML practices within the financial sector.
Reflecting on this significant development, KoFIU CEO Julian Sawyer said, “This comprehensive plan is a milestone in our continuous effort to fortify the financial sector against money laundering risks. It underscores our commitment to uphold the highest standards of regulatory compliance and professional integrity in the industry.”
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