Principles of Risk Mitigation for AML/CTF


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AML Core Compliance programs can benefit tremendously by committing to the logic and structure of a conceptual framework and a companion operational plan. For AML Partners, those two elements are our Legitimacy Lifecycle and the Principles of Risk Mitigation.

AML Partners’ Legitimacy Lifecycle provides the conceptual framework for AML Compliance that spans the entire lifecycle of a customer relationship. With the Legitimacy Lifecycle, institutions possess a roadmap to move their clients from onboarding through risk monitoring through offboarding—in a manner that ensures that legitimate customers with legitimate activity progress through an institution’s system with the least amount of interruption while capturing and reporting suspicious activity as it occurs.

Central to each stage of the Legitimacy Lifecycle is PORM—Principles of Risk Mitigation. Principles of Risk Mitigation provide for Compliance officers a simple yet powerful action plan that provides a consistent and logical analytic sequence designed to mitigate the risk of money laundering and terrorist financing at each lifecycle stage of a customer relationship.

Applied at each Lifecycle stage, PORM requires three distinct processes for effective risk mitigation: 1) Discovery (occurring in the data collection process of CDD/KYC), 2) Analysis (occurring in the creation and systematic application of risk modeling), and 3) Risk Mitigation (occurring via the application of systematic internal controls relative to the results from the discovery and analysis processes customer by customer).

“The Principles of Risk Mitigation provide a logical and efficient operational foundation for the day to day work of AML Compliance professionals,” said AML Partners’ CEO Frank Cummings. “The Legitimacy Lifecycle provides the conceptual framework of Core AML Compliance, and the Principles of Risk Mitigation provide the overall operational plan for the day to day work of AML/CTF. Using the Principles of Risk Mitigation at each of the Lifecycle stages provides a consistent and logical drill-down approach that achieves powerful and effective risk mitigation.”

To learn more about the Legitimacy Lifecycle and the Principles of Risk Mitigation and how they can be used in your AML/CTF Core Compliance Program, contact us today. We also provide customized demonstrations of SURETY Suite, our end-to-end AML Compliance software solution. Components of SURETY-Suite include SURETY-CDD®, SURETY-Behavioral Monitoring, and SURETY-Sanctions Screening.