In July 2013, the FCA published its Thematic Review 13/3 “Banks’ control of financial crime risks in trade finance” (the “Review”) which explained the findings of the regulator’s visits to 17 commercial banks to assess the systems and controls in place to contain the risks of money laundering, terrorist financing and sanctions breaches. Following the Review, the FCA consulted on examples of good and poor practice in “Banks’ control of financial crime risks in trade finance” and proposed to include the examples in its regulatory guidance, Financial Crime: a guide for firms.
On 12 June 2014, the FCA published the responses to the consultation. In the face of concerns that the examples appeared too prescriptive, the FCA emphasised the importance of a risk- based approach, noting, “We remain firmly committed to the risk-based approach as the most effective way to assess and mitigate financial crime risk. We have always sought to make clear our expectation that our Guide will be used in a risk- based, proportionate, outcomes-focused way. We understand that firms have very different ways of meeting their legal obligations given such factors as their nature, size and complexity and the Guide includes, in the introduction, examples of how the same piece of guidance might apply to different firms. This is designed to help users understand that they can adapt the contents of the Guide to suit their individual circumstances.”