The Challenges in Conducting an AML/CFT Audit in Offshore Jurisdictions

Author: Kem Warner, CAMS-Audit

The purpose of this paper “The Challenges in Conducting an AML/CFT Audit in Offshore Jurisdiction” will seek to illustrate why an Anti Money Laundering/Counter Financing of Terrorism (AML/CFT) Audit is one of the key ingredients in an effective AML/CFT Program. The paper will allow readers to gain a comprehensive understanding of how and why an AML/CFT Audit should be conducted on a risk-based approach as opposed to a prescriptive approach. It will also emphasize some differences between an AML/CFT Audit and a Financial Audit, who should conduct it and how it should be conducted. The paper will allow the readers to understand some challenges faced by small companies operating in offshore jurisdictions. It will also offer suggestions to institutions, governments, regulators and law enforcement agencies and those who conduct an AML/CFT Audit for improving the procedures and scope. The paper will also address some possible perceptions by onshore jurisdictions on AML/CFT Compliance in offshore jurisdictions. The facts and opinions are drawn mostly from knowledge of the Caribbean jurisdictions.

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