Banking Non-Profit Organizations (NPOs)—How Financial Institutions can Avoid Wholesale De-Risking NPOs by Mitigating Money Laundering and Terrorist Financing Risks Posed by the Sector
Author: Chris Galloway, CAMS-FCI
The main focus of this paper is to present a risk framework that FIs can adopt in order to provide services to legitimate NPOs and to outline the following AML/CTF areas and how they relate to NPOs:
- Building a Risk-Based-Approach – How FIs can avoid a one-size-fits-all approach to risk rating NPOs.
- Risk Mitigation for NPOs – What internal controls, generic risk mitigation and risk focused measures are applicable when conducting business with NPOs?
- Ongoing Monitoring for NPOs – What transaction monitoring strategies apply to NPO business on a product, geographic or client level?
- Enhanced Due Diligence (EDD) for NPOs – What EDD tasks can be used to obtain information to further mitigate or explain activity?