The Compliance Function assesses and ensures that all the Bank’s activities comply with the relevant laws, regulations and internal policies and procedures. Compliance reviews are conducted across departments and appropriate recommendations are made. Any type of non-compliance and risk identified is duly reported to Senior Management, the Compliance Committee, Audit Committee of the Board and the Board of Directors. It also co-ordinates and supports the activities within the Bank and provides expertise and advice in compliance–related matters. The summary activity of the Compliance Committee, which meets at a regular monthly interval, is forwarded to the Audit Committee of the Board on a quarterly basis.
A Sanction Screening system is in place to enable real time screening of all details contained in incoming and outgoing Swift messages. The decision workflow below is the internal process that the Bank applies for investigation and instruction on alerted messages. In the case of a false positive and no issue is found, User 1 takes the Pass decision and releases the message. In the case of a possible true hit, User 1 escalates the alert to User 2. This action moves the alert to a Pending Review state. User 2 then decides to Pass or Fail the message. This screening tool helps to reduce the Bank’s risk of being exposed in facilitating payments for individuals and organizations blacklisted under the US, EU, OFAC and UNSC.
To manage the money laundering risk which the Bank could be exposed to, the Compliance function through the Money Laundering Reporting Officer tracks and reviews suspicious transactions. Moreover, it is empowered to independently report to the Financial Intelligence Unit (‘FIU’) any suspicious transactions. A partly automated Transaction Monitoring system is actually in place for detection of higher risk transactions to guard against money laundering. Now, the Anti-Money Laundering (‘AML’) framework adopted by the Bank will be further supported by the installation of AML software. The AML software will improve the KYC profiling of customers through enhanced due diligence, customer identification, screening and customer risk scoring. It will also enhance the monitoring and review of customers and their activities and allows the Bank to manage financial crime and regulatory risk more effectively. The AML Training Programme of the Bank is set up as per the image below:
With the internal procedures and control in place, the Bank is able to detect attempted frauds and prevent losses for all parties involved. As per the instructions issued to senior management and front liners, all attempted frauds are also duly reported to the Bank of Mauritius. Between July 2013 - June 2014, 18 attempted frauds cases, amounting to MUR 37.3m, were detected and reported by the Bank. Furthermore the internal control and existing policy and procedure were reviewed and strengthened.
Compliance activity is covered through an Annual Compliance plan, approved by the Audit Committee, which comprises a schedule and frequency of field reviews of all the areas of regulatory risks. Other activities of the Compliance function are:
- conducting independent investigations for suspicious cases and ensuring that appropriate actions and decisions are taken
- assisting investigative authorities in conducting investigations
- handling Court cases and summons filed against the Bank
- managing the Bank’s Complaint Desk
- implementation of FATCA (Foreign Account Tax Compliance Act) by preparing Action Plan document, modifying Account Opening Forms and providing training to Sales staff
- assisting the Bank of Mauritius, Financial Services Commission and external auditors during their audit
- providing support on new projects of the Bank (E-Statements, XtraMiles, Physical Archiving and Prepaid Cards)
- preparing and circulating to staff of the Bank, action points and summary of changes in existing Legislations and Guidelines and new Legislations and Guidelines. On a quarterly basis the regulatory changes are also reported to the Board Audit Committee
- assisting other departments in setting up and preparing Policies and Procedures
- actively participating in Compliance meetings held at the Bank of Mauritius and Mauritius Bankers Association level, and
- compliance workshops are organised for Senior Management and Relationship Managers to discuss compliance issues and update them about recent regulatory developments.
Furthermore the Compliance Function will now be responsible for the compliance of the entities under the AfrAsia Group and the Representative Offices in South Africa and UK.