Summary of CySEC's Circular C437

Memo #17-2021
CySEC Circular No: C437

Date: 21/04/2021
Subject: Common weaknesses/deficiencies and good practices identified during the onsite inspections performed in relation to the prevention of money laundering and terrorist financing
Purpose: To inform about the results of onsite inspections performed to Regulated Entities to assess their compliance with the AML Law and the CySEC’s AML Directive.

In Summary:

CySEC has issued the Circular C437 on 21/04/2021 to inform the CIFs, ASPs, UCITS Management Companies, Internally managed UCITS, AIFMs, Internally managed AIFs, Internally managed AIFLNPs and Companies with sole purpose the management of AIFLNPs, about good practices applied by Regulated Entities and some common weaknesses/deficiencies that CySEC identified during onsite inspections to its Regulated Entities to assess their compliance with the Prevention and Suppression of Money Laundering and Terrorist Financing Law (‘the Law’) and the CySEC’s Directive for the Prevention and Suppression of Money Laundering and Terrorist Financing (‘the Directive’).

This Circular includes in details about the:

    A. Consolidating good practices identified 
    B. Common weaknesses/deficiencies identified

The Consolidating good practices identified are relevant to:

    • EU/UN Sanctions screening
    • AML/CFT Risk Assessment
    • Ongoing monitoring
    • Increased AML/CFT staff training
    • AML/CFT Internal Control Measures
    • Record keeping

The Common weaknesses/deficiencies identified are relevant to:

    • Customer Due Diligence (CDD) Measures
    • AML/CFT Risk Assessments
    • Transaction Monitoring

CySEC notes that the publication of the common weaknesses and deficiencies identified during the onsite inspections may prove useful to Regulated Entities when identifying and managing risk and in considering their AML/CFT policies, procedures and controls, thus ensuring full compliance with the Law and the Directive.

CySEC also notes that Regulated Entities should be aware of the common weaknesses/deficiencies that are referred on this Circular C437 and avoid similar pitfalls. 

CySEC further notes that in the event of non-compliance, Regulated Entities will be subject to the administrative sanctions available to and enforced by CySEC under the Law.

Read the CySEC Circular C437

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