Representatives of the State Financial Intelligence Service under the Government of the Kyrgyz Republic and the country's commercial banks (BTA Bank, Kyrgyz Investment and Credit bank, and Demir Kyrgyz International Bank) took part in a round table discussion entitled "Best AML/CFT Practice", held at the Moscow office of the International Training and Methodology Centre for Financial Monitoring on 5 December 2017 with the support of Rosfinmonitoring.
Representatives of the Federal Financial Monitoring Service, the International Training and Methodology Centre for Financial Monitoring and the Compliance Council, an advisory body at the Interagency Committee for Combating Money Laundering and Terrorist Financing (VTB Bank, Sberbank and Tinkoff Bank), shared their experience in communicating with the private sector (using the example of the Compliance Council) and promoting contact-free interaction and ML/TF prevention techniques (personal profile), as well as provided insight into the most relevant issues of compliance and banks' operating activities such as:
- Use of the indicators of suspicious transactions to identify at an early stage the typologies of criminal activities related to the use of deposit accounts;
- A model approach to the assessment of suspicious transaction risks;
- Promotion of financial literacy through the Compliance Council's activities and active social contribution to the state information policy;
- Adoption of the KPI system by the Compliance Council;
- Description of the achieved result through improvements to the quality of suspicious transaction reports;
- A system of priorities and a focus on the monitoring of transactions carried out in the country's regions;
- A system for summarizing the results of AML/CFT activities at least once in a quarter;
- Internet intelligence, information gathering and identification of risks in the activities of a compliance analyst;
- Access to online government services for reconciliation of client documents;
- Improving effectiveness through human interaction between compliance units;
- Active reproduction by the mega regulator of a sufficient methodological framework for compiling and identifying AML/CFT typologies;
- Strengths and weaknesses of the remote system for starting and registering new businesses (provision of documents to the bank);
- List of undesirable clients (consolidated database of commercial banks);
- Challenge: how to spot the difference between startups and shell companies;
- Scanning bank products for compliance risk and ML/TF abuse;
- Impact from creating a dedicated unit tasked with collecting client documents;
- Challenges linked to the checking of enforcement orders and risks.
With a view to strengthening the fight against money laundering and terrorist/extremist financing, Kyrgyzstan's officials and representatives of Rosfinmonitoring agreed to establish a joint inter-state system of cooperation between compliance councils of the major Russian and Kyrgyz banks. Kyrgyzstan's Financial Intelligence Unit has already begun the work to establish a Kyrgyz compliance council, selection of candidates and outlining of its functions.
These activities have signalled a joint start of processes to destroy the factors, prerequisites and conditions behind ML/TF in the first line of banks' operating activities. They also represent another joint step towards strengthening the security of Kyrgyzstan's financial system and safeguarding the country's economic interests against abuse. This is a completely new approach to the fight against money laundering and terrorist/extremist financing at an early stage.
State Financial Intelligence Service under the Government of the Kyrgyz Republic