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Circular C252 (The Risk-Based Supervision Guidelines)

CySEC wishes to inform the Regulated Entities of the following:

  1. The Joint Committee of the three European Supervisory Authorities (“ESAs”) (i.e. EBA, EIOPA and ESMA) published, on the 07.04.17, its final guidelines on the characteristics of a risk-based approach to AML and CFT supervision, and the steps to be taken when conducting supervision on a risk-sensitive basis (“The Risk-Based Supervision Guidelines”), in relation to the new Fourth AML (EU) Directive.
  2. The Risk-Based Supervision Guidelines are addressed to National Competent Authorities and their aim is to create both, a common understanding of the Risk-Based Supervision (“RBS”) and to establish consistent and effective supervisory practices across the EU.
  3. More specifically the RBS is characterised as an ongoing cyclical process that includes the following steps:
  4. Identification of ML/TF risk factors;
  5. The risk assessment;
  6. The allocation of AML/CFT supervisory resource based on the assessment;
  7. Monitoring and Review.

CySEC’s expects that: Considering that the Risk-Based Supervision Guidelines apply since 07.04.18, CySEC has incorporated them into its RBS Framework, as appropriate in the relevant AML/CFT RBS process. Hence, the Regulated Entities shall take into account and comply with those.

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