The Finance Ministry's Financial Crimes Investigation Board (MASAK) will soon require banks and other financial institutions to implement programs meant to prevent the financing of terror activities and the laundering of criminal revenues.
The Postal and Telecommunications General Directorate (PTT), brokerage firms, banks, insurance companies and retirement funds will prepare so-called harmonization programs for internal auditing, risk management monitoring and inspection activities within the scope of combating the finance of terror and money laundering.
According to the Anatolia news agency, the directive prepared by MASAK was given its final shape last week. It was prepared in consultation with the Association of Banks, the Banking Regulation and Supervision Agency (BDDK), the Capital Markets Board (SPK), the Treasury, the Turkish Union of Participation Banks, the Capital Markets Brokerage Institutions Union, the Insurance and Reassurance Corporations Union, PTT and the Central Bank of Turkey, and will reportedly be sent to the prime minister for approval in a week.
The harmonization program will be developed by each firm based on a risk-oriented approach to preventing the funding of terrorism and laundering of criminal revenues. It will include creation of corporate policy and procedures, execution of risk management activities, carrying out monitoring and control activities, appointment of relevant staff for harmonization, creation of a harmonization unit and implementation of training and auditing activities.
Within the harmonization program, firms will devise a corporate policy to reduce risk by considering the size of their enterprises, internal volumes and the characteristics of the transactions that they carry out in an attempt to adapt procedures to a focus on prevention of terror funding and laundering of criminal revenues.
Companies will draw up a risk description based on their customers, service type and country risks and rate their customers, services and transactions based on these risks.
The risk management units will monitor high-risk customers, transactions or services and subsequently submit reports on a regular basis to inform the relevant units of their risk assessment. They will also intervene in customers' transactions assessed as presenting high risk when necessary and report the results to the executive board on a regular basis.
The firms will also appoint personnel to ensure the proper execution of the harmonization program.
Under an interim provision in the directive, the companies must appoint a harmonization authority within 30 days after the directive goes into effect. The firms then must develop their harmonization programs within three months following the appointment of this person.
Source: ZAMAN
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