Examination programme 2025

Thematic examinations

Suspicious activity reporting

This thematic examination will assess the effectiveness of systems and controls that supervised persons apply to reporting suspicions of ML/TF/PF as required under the Money Laundering Order and the AML/CFT/CPF Handbook.

The focus of the examination will include:

• policies and procedures for reporting
• reporting knowledge or suspicion
• Financial Intelligence Unit consent
• disclosure to group companies and networks
• tipping off

Outsourcing arrangements

Compliance with the outsourcing policy is a requirement under the Codes of Practice and the AML/CFT/CPF Handbook. It sets out the seven core principles that a business must comply with and applies to regulatory and financial crime prevention and detection activities. Supervised persons must be familiar with these core principles to ensure we are appropriately notified.

The SEU previously conducted a thematic examination on outsourcing in 2019, where findings were identified in a significant number of examinations against one or more of the core principles of the Outsourcing Policy.

We will assess whether compliance with the core principles of the outsourcing policy has improved. It will also assess the extent to which entities are capturing the new activities identified in the revised outsourcing policy which came into effect on 1 January 2024, which includes changes for outsourced activities relating to cloud storage, data, cyber and digital identification services.

See findings from our 2019 thematic examination on Outsourcing.

Thematic assessment visits (TAVs)

Banking - fraud controls and response

This is a continuation of our 2024 TAVs looking at the effectiveness of banks’ systems and controls to detect and prevent fraud.

See details on our thematic examination programme 2024.

Fund services business and trust company business - transaction monitoring

Supervised persons must monitor and recognise all customer transactions and activity, including the background and purpose.

This TAV will assess:

• compliance with the statutory and regulatory obligations set out relating to transaction monitoring
• the processes supervised persons undertake to recognise and scrutinise transactions in terms of real time monitoring and post-event monitoring.

Investment Business - fees, charges and commissions

Supervised persons are required to make clients aware of all fees and charges, including commissions, effectively a “no surprises” policy. In circumstances where a supervised person is operating in a discretionary manager capacity, it is obligated to make it clear to its clients the associated fees and charges payable and advise its clients on a timely basis, of all fees and charged incurred.

This TAV will assess supervised persons’ compliance with Principle 4.6 and 4.7 of the Investment Business Codes of Practice.

Accountants – customer risk assessment

An effective risk assessment process is fundamental in driving a business’ risk-based approach to customer due diligence measures. If the money laundering and terrorist financing risks have not been adequately assessed, the identification measures and ongoing monitoring undertaken based on that risk assessment may not be effective to mitigate the risks presented by a business relationship or one-off transaction.

This TAV will assess the extent to which supervised persons have applied an appropriate risk-based approach to its customer risk assessments and whether the accountancy sector is adequately assessing the risk, that their business relationships or one-off transactions may involve money laundering, terrorist financing and proliferation financing.

Prescribed non-profit organisations (NPOs) - proportionate risk-based measures to mitigate the risk of NPOs being misused for terrorist financing purposes

This TAV will assess the understanding of prescribed NPOs of proportionality in accordance with the requirements of the Non-Profit Organisations (Prescribed NPOs – Additional Obligations) (Jersey) Order 2022 and relevant parts of the Codes of Practice, set out in section 17 of the Handbook.

This TAV will focus on whether prescribed NPOs are implementing the requirements in a proportionate manner relevant to their size and complexity whilst still meeting the minimum requirements, or going over and above the requirements set, in a manner which is detrimental to the overall good work of the NPO.

VASPs - the travel rule

VASPs are required to demonstrate that they are taking reasonable steps to comply with the travel rule. During 2024, a TAV was conducted to assess progress made on the changes in relation to the Travel Rule guidance note published in February 2024. Individual feedback was given to each VASP. A bitesize feedback paper was issued which set out a summary of good practice and areas for further improvement.

This TAV is the second phase of the assessment conducted in 2024 and will be aimed at testing compliance with the extended wire transfer regulations for VASPs, to establish whether required information to accompany transfers between VASPs, can be provided.

AMLSPs

Section 18 of the AML/CFT/CPF Handbook sets out the statutory provisions concerning AMLSPs. This TAV will look at the practical measures AMLSPs have put in place to comply with the Codes of Practice. This TAV will be carried out by issuing a questionnaire, followed by face-to-face interviews with a select number of AMLSPs, to assess their compliance with the obligations in more detail.