Overview of the PNG Financial Sanctions regime – Effective monitoring and supervision of Targeted Financial Sanctions
Presentation Outline ❑ Monitoring & Supervision of TF & PF ❑ Supervision by FASU ❑ Who is supervised by FASU? ❑ Supervision and monitoring of sanctions ❑ Initiatives undertaken ❑ Challenges ❑ Conclusion
Supervision FASU in BPNG as sole Supervisor ( S. 72 of the AML/CTF Act 2015 ) FASU supervises all financial institutions and DNFBPs in this national AML CTF regime
Who is Supervised by FASU? There are two primary groups that are supervised which includes the FIs and DNFBPs Financial Institutions (FIs) DNFBPs i. Commercial banks i) real estate agent, ii. Foreign subsidiaries of banks ii) a motor vehicle dealer iii. Savings and Loans societies, Microbanks, iii) a dealer in precious metals Microfinance companies iv) a dealer in precious stones, iv. Life Insurance, General Insurance v) a lawyer v. Superannuation funds vi) notary public or other independent vi. Investment banks legal professional vii. Mortgage companies, Finance companies vii) a trust or company service provider viii. Money remitting services, money changers viii) accounting practitioners/professional NB : DNFBP – Designated Non-Financial Businesses or Professions Bank of Papua New Guinea
Supervision and Monitoring Financial institutions and DNFBPs are required to put in place effective procedures, policies and controls for – • Monitoring the risks • Complying with customer due diligence requirements ✓ Ensuring that transactions carried out on behalf of its customers are consistent with the customer profile
Supervision & monitoring 2018/19 to current, 7 onsites conducted on FIs/DNFBPs: Focused on Transaction monitoring programs that covered sanctions screening. Most institutions use World Check and SWIFT sanctions screening tools. For non-banks, it was noted that they rely on tools provided by SWIFT/FASU
Effective supervision and monitoring of sanctions Section 40 of the AML/CTF Act: FIs and DNFBPs must report to FASU any assets of a designated person or entity which it holds within 10 working days. The reporting form is prescribed and was issued in May 2019.
Initiatives Undertaken Year # of awareness Audience Places sessions 2016 10 General Public, Schools, Port Moresby (x6), Lae (x1), Radio awareness (in Tok Madang (x1) Pisin), Business Vanimo (x1), Kokopo (x1) communities, FIs, DNFBPs, LEAs, NCC member agencies 2017 19 Port Moresby (x11), Lae (x5) * FASU collaborates with Department Kokopo (x2), Madang (x1) of Justice & Attorney General, Royal PNG Constabulary, Investment Promotion Authority, PNG Customs, 2018 13 Port Moresby (x3), Lae (x3), PNG Law Society, Certified Practising Madang (x1) Accountants, Real Estate Industry Association, Transparency Wewak (x1), Vanimo (x1), International, Chamber of Goroka (x1) Commerce, etc Kavieng (x1), Kimbe (x1), Kokopo (x1) June 8 Port Moresby (x4), Lae (x3), 2019 Mt. Hagen (x1)
Initiatives Undertaken Year Initiative Purpose Outcomes Filter transactions by imbedding False positives. Can verify if FIs 2016 AML/CFT lists on the system/KATS mostly banks are using module on screening tools. Volumes of KATS transactions can be compared. TF & PF risks low but must be 2017 NRA findings Awareness, training and watched closely capacity building. Watch media and monitor open source - MoUs, (Customs, Police, 2017- Development National Maritime Authority Immigration, Fisheries & Forest 19 of Regulatory engagement/shipping Authorities) tools register. -Guidance -Compliance Rule and CDD Advisory notes for FIs & DNFBPs developed and issued -Intelligence database capacity -Interpol database -UN subscription on list updates for dissemination to FIs and DNFBPs and to relevant agencies and Public.
Conclusion ❑ The designated TF and PF supervision mandate needs to be explicit. FASU supervises under border AML/CFT Act. ❑ Important to continue raising awareness and assisting the smaller FIs and DNFBPs in particular in terms of transaction monitoring and sanctions screening ❑ The SOP developed under UN Sanctions Act needs good awareness with all relevant stakeholders. ❑ Sanctions secretariat function must be resourced to administer the Act. ❑ Some strategic decisions to make to demonstrate effectiveness.
QUESTIONS?
Contact FASU Postal Address: Financial Analysis and Supervision Unit Bank of Papua New Guinea P O Box 121 PORT MORESBY National Capital District Papua New Guinea Telephone: 322 7147 Facsimile: 322 7239 Email: fasu@bankpng.gov.pg Website: www.bankpng.gov.pg/about-us/amlcft-anti- money-laundering/
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