AML/CTF Independent Reviews - A Deep Dive

Reviews offer an objective assessment, conducted by a party entirely independent from the development and implementation of the program. Their purpose is to verify that the program is functioning effectively to safeguard your club against regulatory, legal, and reputational risks associated with non-compliance.

AUSTRAC provides that independent reviews check whether your AML/CTF program: 

• Properly addresses your ML and TF risks.
• Is compliant with your legal obligations.
• Is working as it should.

How often independent reviews should be undertaken?

Independent reviews must be conducted every 2-3 years. Review frequency is determined by your ML/TF risk, and what is deemed appropriate and written into your program, i.e. the higher and more volatile your risk, the more frequently an independent review is completed.

Ad-hoc independent reviews can also be conducted when there is a change to your business (new gaming products introduced, amalgamation, or other major operational changes) which may change your ML/TF risk profile; in response to changing regulation; or in response to adverse regulatory findings.

Who can conduct an independent review?

It is important that you can, with confidence, justify that your chosen independent reviewer is someone who:

• Understands your business or organisation.
• Understands ML/TF risks.
• Was not involved in, or influenced by, anyone who developed your program, including assessing your ML/TF risk, developing controls or implementing or maintaining the program.

Recommendations from an adviser who developed your AML/CTF program will be scrutinised by AUSTRAC should they audit your venue. ClubsNSW provides a non-exhaustive list of AML/CTF advisers you may consider engaging. However, you are encouraged to complete further research, compare providers, and ensure the agreed scope of works covers all independent review requirements.

How are independent reviews conducted?

Independent reviews are an intrusive process. You should consider these a trial audit which emulates the process AUSTRAC may undertake when investigating your club. Independent reviewers should:

• Start with a request for key documentation to understand your risk assessment and program.
• Assess whether your risks are adequately identified and addressed.
• Evaluate legal compliance and control effectiveness.
• Interview staff, managers, and directors.
• Review records to verify adequate implementation on the program.

The greatest AML/CTF programs are ineffective without proper implementation. Further, if implementation cannot be evidenced through your records, demonstrating compliance to the regulator is impossible.

Reporting and Remediation

Following the review, you should be provided with a report documenting the reviewers findings and recommendations. It must be provided to senior management and the board. Any independent review that identifies any issues or opportunities to improve compliance, should be scrutinised for depth, rigour and alignment to the legislative requirements.

Following the review, a remediation plan must be developed to address any identified gaps or areas for improvement. This plan should be thoroughly reviewed, discussed, and formally endorsed by the board. 

Progress toward completing the remediation plan should be tracked and reported in all future AML/CTF board updates until full implementation is achieved.

How should the board be involved?

To support effective oversight, the independent reviewer should meet with the board to present their findings and recommendations and be available to answer questions. This engagement enables directors to seek clarification, probe deeper into the review outcomes, and constructively challenge the club’s AML/CTF compliance framework.

Support provided by ClubsNSW

Webinars

To support members, ClubsNSW has launched the AML/CTF Compliance Webinar Series, offering valuable insights and practical guidance on compliance obligations. The series will cover customer due diligence; achieving risk-based compliance; managing an AML/CTF program; suspicious matter reporting; board and senior management oversight; independent reviews; and common compliance pitfalls.

You can view existing episodes here. To receive notification as new episodes are released you can subscribe here.

Training

ClubSAFE offers three tailored AML/CTF courses designed to address the unique needs of each role, including:

• Frontline gaming staff.
• Boards and senior management.
• AML/CTF compliance officers.

We regularly schedule Virtual AML/CTF Compliance Officer Training. To register your staff, please click here. ClubSAFE Premium members can access this training at no cost and should click here.

If you have any questions about AML/CTF compliance, the ClubSAFE program and its AML/CTF offering, or any general questions, please contact ClubASSIST at 1300 730 001 or via email at [email protected]