How often is AML training required?

The recommended frequency of AML training organised by an MLRO (Money Laundering Report Officer) is dependent upon several factors that we will cover below – but it is recommended by the Academy that training takes part at least annually.

The objective of AML Training

The objective of AML training is to engage, inform and inspire employees to obtain a robust knowledge and understanding of the following:

• The common methods and trends of Money Laundering (“ML”) and Terrorism Financing (“TF”) relevant to the organisation.
• The organisation’s AML/CFT policies, procedures, systems and controls.
• The ability to identify potential suspicious behaviours or activities, and how to report these events to the MLRO.
• The individual roles and responsibilities distributed across the organisation in order to combat ML and TF.

One Size Does Not Fit All

It is important to highlight that not all employees across an organisation carry out the same job description – as a result, the AML training designed for each department should reflect the diversity in roles and responsibilities.

MLROs have the responsibility to ensure that employees receive relevant and appropriate training programmes in line with their roles and responsibilities. Employees should understand the extent of their exposure to ML/TF and have the ability to distinguish the red flags and suspicions while conducting their duties.

The Frequency of AML Training

According to Financial Action Task Force (“FATF”) 2012 Recommendations, organisations should conduct AML/CFT training on an ongoing basis.

MLROs should arrange  the following training:

• New Starter Training: For new employees who have recently joined the organisation.
• Refresher Training: Ongoing training for existing employees.
• Special Purpose Training: Training on new regulation/internal policy or the organisation’s new product, service or technology.

New Starter Training

New starters should receive AML training as soon as possible. The Academy recommends conducting the training within 7 – 10 working days of an employee’s start date.

Refresher Training

In order to determine how often AML/CFT training should be given to existing employees within each department, MLROs should apply a risk-based approach in order to manage the resources versus the ML/TF risk that each department is exposed to.

The higher the risk of ML/TF, the more frequent the training should be. For instance, the first line of defence (i.e. the relationship managers) should receive more AML/CFT training than the second (i.e. Compliance and AML team) or third line of defence (i.e. internal audit team).

Based on international best practices, it is recommended that an organisation should train its employees once on an annual basis as a minimum.

Special Purpose Training

 The frequency of Special Purpose Training varies depending on the updates received from regulators, law enforcement agencies, authorities, intergovernmental bodies, etc. as well as the  organisations’ expansion plans.

MLROs have to keep the relevant employees informed on any regulatory updates related to AML/CFT as well as the level of ML/TF risk associated with a new product, service or technology that the organisation introduces.

Special Purpose AML Training should take place as soon as it is practical to do so.

Summary

The requirements and expectations with regards to AML that regulators around the world promote are to ensure that all the employees have the required awareness and knowledge of ML/TF risks.

To conclude, MLROs are responsible for assessing the frequency of AML training within their specific organisation . Ultimately, training frequency depends on several factors such as an employee’s roles and responsibilities, regulatory expectations, relevant rule changes, and any new organisational developments.

As a minimum,  MLROs should ensure that the AML training is conducted once a year for all the staff.

Article written by Souzan Esmaili

Associate Director, MENA

Great Chatwell Academy of Learning