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  • Annual Compliance Review

    • FC-3.3.1

      Investment firm licensees must take appropriate steps to identify and assess their money laundering and terrorist financing risks (for customers, countries or geographic areas; and products, services, transactions or delivery channels). They must document those assessments in order to be able to demonstrate their basis, keep these assessments up to date, and have appropriate mechanisms to provide risk assessment information to the CBB. The nature and extent of any assessment of money laundering and terrorist financing risks must be appropriate to the nature and size of the business.

      Added: October 2014

    • FC-3.3.1A

      Investment firm licensees should always understand their money laundering and terrorist financing risks, but the CBB may determine that individual documented risk assessments are not required, if the specific risks inherent to the sector are clearly identified and understood.

      Added: October 2014

    • FC-3.3.1B

      Investment firm licensees must review the effectiveness of its AML/CFT procedures, systems and controls at least once each calendar year. The review must cover the licensee and its branches and subsidiaries both inside and outside the Kingdom of Bahrain. An investment firm licensee must monitor the implementation of those controls and enhance them if necessary. The scope of the review must include:

      (a) A report, containing the number of internal reports made in accordance with Section FC-4.1, a breakdown of all the results of those internal reports and their outcomes for each segment of the licensee's business, and an analysis of whether controls or training need to be enhanced;
      (b) A report, indicating the number of external reports made in accordance with Section FC-4.2 and, where a licensee has made an internal report but not made an external report, noting why no external report was made;
      (c) A sample test of compliance with this Module's customer due diligence requirements; and
      (d) A report as to the quality of the licensee's anti-money laundering procedures, systems and controls, and compliance with the AML Law and this Module.
      Amended: January 2022
      Amended: October 2014
      Amended: January 2007

    • FC-3.3.2

      The reports listed under Paragraph FC-3.3.1B (a) and (b) must be made by the MLRO. The sample testing and report required under Paragraph FC-3.3.1B (c) and (d) must be made by the licensee’s external auditor or a consultancy firm approved by the CBB.

      Amended: January 2022
      Amended: January 2019
      Amended: October 2011

    • FC-3.3.2A

      In order for a consultancy firm to be approved by the CBB for the purposes of Paragraph FC-3.3.2, such firm should provide the CBB's Compliance Directorate with:

      (a) A sample AML/CFT report prepared for a financial institution;
      (b) A list of other AML/CFT related work undertaken by the firm;
      (c) A list of other audit/review assignments undertaken, specifying the nature of the work done, date and name of the licensee; and
      (d) An outline of any assignment conducted for or in cooperation with an international audit firm.
      Added: October 2011

    • FC-3.3.2B

      The firm should indicate which personnel (by name) will work on the report (including, where appropriate, which individual will be the team leader) and demonstrate that all such persons have appropriate qualifications in one of the following areas:

      (a) Audit;
      (b) Accounting;
      (c) Law; or
      (d) Banking/Finance.
      Added: October 2011

    • FC-3.3.2C

      At least two persons working on the report (one of whom would normally expected to be the team leader) should have:

      (a) A minimum of 5 years professional experience dealing with AML/CFT issues; and
      (b) Formal AML/CFT training.
      Added: October 2011

    • FC-3.3.2D

      Submission of a curriculum vitae for all personnel to be engaged on the report is encouraged for the purposes of evidencing the above requirements.

      Added: October 2011

    • FC-3.3.2E

      Upon receipt of the above required information, the CBB Compliance Directorate will assess the firm and communicate to it whether it meets the criteria required to be approved by the CBB for this purpose. The CBB may also request any other information it considers necessary in order to conduct the assessment.

      Added: October 2011

    • FC-3.3.3

      The reports listed under Paragraph FC-3.3.1B must be submitted to the licensee's Board, for it to review and commission any required remedial measures, and copied to the licensee's senior management.

      Amended: January 2019

    • FC-3.3.4

      The purpose of the annual compliance review is to assist a licensee's Board and senior management to assess, amongst other things, whether internal and external reports are being made (as required under Chapter FC-4), and whether the overall number of such reports (which may otherwise appear satisfactory) does not conceal inadequate reporting in a particular segment of the licensee's business (or, where relevant, in particular branches or subsidiaries). Investment firm licensees should use their judgement as to how the reports listed under Paragraph FC-3.3.1B(a) and (b) should be broken down in order to achieve this aim (e.g. by branches, departments, product lines, etc).

      Amended: January 2019

    • FC-3.3.5

      Investment firm licensees must instruct their appointed firm to produce the report referred to in Paragraph FC-3.3.1B (c) and (d). The report must be submitted to the CBB by the 30th of June of the following year. The findings of this review must be received and acted upon by the licensee.

      Amended: January 2022
      Amended: January 2020
      Amended: January 2019
      Amended: January 2012
      Amended: January 2007

    • FC-3.3.6

      [This Paragraph has been deleted in January 2022].

      Deleted: January 2022
      Amended: January 2012

    • FC-3.3.7

      [This Paragraph has been deleted in 2022].

      Deleted: January 2022
      Amended: January 2020
      Amended: January 2019
      Amended: July 2010
      Amended: April 2008
      Amended: January 2007