CBN spells new deadline for Banks,Fintech on automated AML systems
Banks, mobile money operators, international money transfer operators and other financial institutions in Nigeria will be required to deploy automated anti-money laundering (AML) systems under new baseline standards issued by the Central Bank of Nigeria (CBN), as the regulator moves to strengthen financial crime detection and compliance across the financial sector.
The CBN said the new guidelines introduce a framework for implementing automated AML, Combating the Financing of Terrorism (CFT) and Countering Proliferation Financing (CPF) solutions aimed at improving the ability of financial institutions to detect and report suspicious transactions in real time.
According to a circular issued to banks, payment service providers and other financial institutions, co-signed by Akinwunmi, A. Olubukola, director, Banking Supervision Department and Olubunmi Ayodele-Oni, for director, Compliance Department, the standards are designed to enhance compliance with existing AML, CFT and CPF regulations while encouraging the adoption of emerging technologies to strengthen financial crime risk management.
The apex bank said the implementation of the guidelines takes effect immediately from the date of issuance, with financial institutions expected to begin deploying automated systems to support transaction monitoring and regulatory reporting.
Under the new framework, deposit money banks have been given an 18-month deadline to fully comply with the requirements, while other financial institutions, including fintech companies and payment service providers, have 24 months to complete implementation.
The CBN also directed all affected institutions to submit detailed implementation roadmaps to its Compliance Department within three months of the issuance of the circular, outl’ning how they intend to transition to the new automated AML systems.
Regulators say the move is intended to improve the speed and accuracy of detecting suspicious financial activities and reduce the risks of money laundering, terrorism financing and proliferation financing within the Nigerian financial system.
Automated AML systems typically use advanced analytics, data monitoring tools and artificial intelligence to track large volumes of transactions, flag unusual patterns and generate alerts that can be investigated by compliance teams.
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The Central Bank said the baseline standards will support financial institutions in deploying such technologies in a structured manner while ensuring that their systems align with regulatory expectations.
The regulator added that it will continue to monitor developments within the financial system and may issue additional guidance where necessary to ensure effective implementation of the new framework.
“All stakeholders are required to ensure strict compliance with the guidelines and all other regulations,” the circular stated, noting that the measure forms part of the CBN’s broader efforts to promote financial system stability and integrity. (BusinessDay)
