Home " AMLTool Services " Annual AML Risk Assessment Report

Annual AML Risk Assessment Report

It is a document that identifies, evaluates and mitigates risks related to money laundering and terrorist financing. It is mandatory in regulated sectors, such as the financial sector, and ensures that organizations implement effective controls to prevent illicit activities, in compliance with regulatory standards.

Main objectives of the AML Annual Risk Assessment Report

Identify risksAnalyze areas of exposure to money laundering and terrorist financing, considering factors such as the nature of the business, customers, jurisdictions, products and services.
Evaluate the effectiveness of controlsDetermine whether current policies, procedures and controls are sufficient to mitigate identified risks.
Provide recommendations: Suggest improvements or adjustments to strengthen prevention measures and detection of suspicious activities.

Comply with regulationsEnsure compliance with local and international laws, such as the recommendations of the Financial Action Task Force (FATF/FATF) and the Financial Action Task Force (FATF/FATF).FATF/FATF).

Key Elements of the Annual AML Risk Assessment Report

Executive summaryBrief description of the main findings, conclusions and recommendations.
Assessment MethodologyExplanation of the approach used to identify and assess risks.
Risk analysisRisk analysis: Detail of specific risks identified, such as high-risk customers, vulnerable products or problematic jurisdictions.
Internal ControlsEvaluation of existing policies and procedures to manage risks.
Key findingsIdentification of gaps or deficiencies in controls.
RecommendationsSuggested actions to mitigate the risks detected.
Action plans: Timeline and assignment of responsibilities to implement the proposed improvements.

Importance of the AML Annual Risk Assessment Report

Penalty prevention: Helps avoid regulatory penalties for non-compliance.
Reputational protectionStrengthens the confidence of customers, partners and regulators.
Operational efficiencyAllows prioritization of resources to higher risk areas.
Regulatory compliance: Responds to the requirements of regulatory authorities and international standards.

Therefore, this report should be prepared by specialized internal teams or external consultants with AML expertise, and reviewed by senior management to ensure its effective implementation.

contact with us

Do you need help with the report?

Consult with AML professionals at no cost and strengthen your business today.

Verification Questionnaire

Some jurisdictions require, in addition to the Report, that detailed information on their Internal Control System be provided by answering a specific questionnaire.

Annual AML Evaluation Questionnaire (sample)

The Annual AML Risk Assessment Report includes an AML includes an AML Assessment Questionnaire to be completed by DNFBPs (Designated Non-Financial Businesses and Professions). This questionnaire requires the submission of information related to:

Legal form of the reporting entity.
Owners/shareholders with 25% or more ownership or control.
Beneficial owners with 25% or more ownership or control.
If the reporting entity is a branch or subsidiary of another international entity.
Total number of employees in the organization.
Total number of clients during the reporting period.
Number of resident customers who are individuals.
Number of clients whose residence is unknown.
Whether the reporting entity has clients who are PEPs (Politically Exposed Persons).
Number of corporate clients classified according to international, mainland, free trade zone or unknown country of establishment.
If the organization sells jewelry.
Whether the reporting entity engages in refining activities or works with third parties that refine precious metals and stones.
If the entity carries out domestic transactions.
If the entity carries out international transactions.
If the entity accepts or makes cash payments equal to or greater than 10 thousand USD.
List additional products or services related to precious metals and stones that are not covered by the above questions.
If the entity has accepted a single payment in excess of USD 50 thousand.
If the entity operates a store for face-to-face customers.
Total number of face-to-face clients served during the reporting period.
Role of third party entities.
Any non-compliance related to AML compliance.
Number and types of violations according to the list of violation/article/clause.
Whether AML policies are approved by the board of directors and senior management.
Whether the risk assessment considers the results of the national risk assessment.
Whether the risk assessment considers customer risk.
Whether the risk assessment considers delivery channel risk.
If the board of directors and senior management ensure that deficiencies are rectified.
If the entity has designated a compliance officer.
Whether the compliance officer prepares regular and periodic AML reports for the board, senior management and supervisory bodies.
If the compliance officer reviews red flagged transactions and unusual transactions.
Whether customers are identified and verified using reliable and independent information in all cases.
Whether Enhanced Due Diligence (EDD) is performed for all high-risk customers.
If the entity is registered in the goAML system of the Financial Intelligence Unit (FIU).
Whether the entity has established a written list of red flags designed to identify suspicious transactions related to money laundering (ML) and terrorist financing (TF).
Whether the entity maintains records for at least 5 years.
Whether ongoing AML training is provided to staff.
Whether the entity has written policies and procedures to verify whether customers or beneficial owners are subject to specific financial sanctions by the UN Security Council, the UAE or other relevant bodies.
Whether board and senior management involvement includes Targeted Financial Sanctions (TFS).
Whether the entity has ever identified exposure to TFS designees.
Licensing authority.
Number by nationality of owners/shareholders with 25% or more ownership or control.
Number by nationality of beneficial owners with 25% or more ownership or control.
Country of parent entity.
Turnover during the reporting period.
If the customers are individuals.
Number of non-resident customers who are individuals.
If the entity registers the customer's nationality.
If the entity has customers who are legal entities.
Monetary value of transactions for the purchase and sale of precious metals and stones during the reporting period.
If the organization sells bullion.
Main business activity according to income.
Number of domestic transactions per zone.
Top 5 countries by number of transactions during the reporting period.
Whether the entity has received cash for jewelry, bullion or precious metals and stones.
Whether the entity has accepted payments in virtual currency during the reporting period.
If the company offers products or services in any Commercial Free Trade Zone.
Whether the entity operates an online customer website.
Whether the entity uses third party services to sell products, deliver services, introduce customers or perform Customer Due Diligence (CDD).
If the entity exports or coordinates the export of products out of the country.
Number of AML violations.
Whether the organization has prepared AML policies and procedures.
Whether the entity has conducted an internal risk assessment to understand its money laundering and terrorist financing risks.
If the risk assessment considers geographical risk.
Whether the risk assessment considers product, service and transaction risks.
Whether the board and senior management receive periodic AML reports.
Whether senior management reviews high-risk customers.
Whether the compliance officer has the necessary authority and independence to perform his or her duties.
Whether the compliance officer ensures compliance with the entity's AML policies and procedures.
Whether the entity's CDD requirements are in line with the risk-based approach.
Whether the entity identifies and verifies the identity of all beneficial owners of customers.
If the entity verifies whether a customer or beneficial owner is a PEP.
Whether the entity has implemented a process to monitor suspicious transactions that may potentially be linked to AML and TF.
Whether red flags are an integral part of written AML policies and procedures.
If CDD data and business correspondence are kept for at least 5 years after the end of the customer relationship.
Whether AML training is provided immediately or shortly after hire.

contact with us

Effective Compliance

Get to know our AML Solutions with a free personalized consultation.

You ask, we answer

These questions and answers help to clarify the most common doubts and highlight the importance of an AML Annual Risk Assessment Report.

What is the AML Annual Risk Assessment Report and why is it important?

It is a mandatory document that assesses the risks related to money laundering and terrorist financing to which an entity is exposed. Its importance lies in identifying vulnerabilities, ensuring regulatory compliance and mitigating regulatory sanctions.

Who is required to file the report?

Entities designated as DNFBPs (Designated Non-Financial Businesses and Professions) and other regulated financial institutions must complete and submit the report according to the legal requirements of the country where they operate.

What type of information is required to complete the report?

Data related to the legal structure of the entity, its customers, owners, domestic and international transactions, activities related to sensitive products (such as precious metals), internal controls and compliance policies are requested.

How often should the report be prepared and submitted?

The report must be prepared and submitted annually, generally within the deadlines established by the relevant regulatory authorities.

What happens if an entity fails to file a report or fails to comply with regulations?

Non-compliant entities may face penalties, administrative fines, operational restrictions and reputational damage that can seriously affect their business.

What benefits does the report bring to the organization?

It identifies operational risks, improves internal controls, strengthens stakeholder confidence, ensures regulatory compliance and avoids legal and financial penalties.

contact with us