Three of my very most favourite things in the world are delivering training, MLROs and biscuits – so when I can combine the three (as in tomorrow’s workshop for experienced MLROs in Guernsey, with two biscuit breaks) I am a very happy bunny indeed. I have been running these MLRO workshops for years, and they are just the most exciting events: I prepare a ton of information and raid M&S for gingerbread men, but then on the day our discussions range far and wide, and I always learn such a lot. And the fact that some of “my” MLROs are coming to their eighth workshop tomorrow tells me that they find the training useful and correctly pitched.
So when the UK’s Financial Conduct Authority published its thematic review on “How small banks manage money laundering and sanctions risk” earlier this month, I was despondent to read that: “The level of AML and sanctions knowledge among MLROs in a quarter of banks visited was inadequate. In particular, they did not understand their legal and regulatory responsibilities, money laundering risks, or ‘red flags’ relevant to their bank. The MLRO is an essential function and a weak MLRO cannot meet their obligation to oversee their bank’s AML compliance. We found that MLROs in a quarter of banks had a detrimental effect on the overall standard of AML and sanctions systems and controls in their bank. Following our visits, several banks have decided to replace their MLROs.” Those poor MLROs. (And before you suggest it, yes, I have contacted the FCA and offered my training services – but the FCA isn’t really in the training market, and it would be quite a step for them to do it.) I have tried to run my MLRO workshops in London, but I’m not nearly as well-known there as I am in “the islands and isthmus”, and I just couldn’t fill the room. But perhaps now, with the FCA breathing down their necks, UK financial institutions will be more receptive to the idea of dedicated training for their MLROs, and not expect these poor souls just to pick it up as they go along – or not, as seems to be the case. Imagine the horror of being an MLRO while not understanding your legal and regulatory responsibilities! And as for concept of an MLRO actually being detrimental… well, pass the biscuits, as I urgently need reviving.
I have received the following very helpful response to this post from a reader who works in the forex sector in the UK, and thought I would share it:
“I am enrolled on the ICT AML Diploma – I have just started my reading, with the first workshop next week. This course is aimed at MLROs and from what I understand, it is very popular with the course being massively oversubscribed – that they have had to run two sets of workshops. (https://learning.int-comp.com/login/index.php).” [My comment: I too have heard excellent things about these diplomas and qualifications – although of course they are one-offs rather than ongoing training. Mind you, it sounds as though the “detrimental quarter” did neither.]
“As an aside, I am a member of MLROs.com, which this year has held three training workshops. These are usually of a very high standard with a mixture of speakers (http://www.mlros.com/).” [My comment: I had quite overlooked the events offered by the various MLRO groups – I should have mentioned them.]
“As I am very well aware, being an MLRO is quite a vulnerable position to be in. One of the reasons for taking the course, is that there is such a lot to know and very little time to read and keep on top of change. Multiply this by holding both the CF10 and CF11 functions, and well, unless you are a juggler, contortionist, animal trainer and ring-master(mistress) at the same time, it is an almost impossible task to keep your knowledge on the cutting edge. Some may see this as scaremongering, but it is a tough ask of any individual and the compliance/AML team.”
I disagree to an extent with your commenter Susan. Someone in a full-time MLRO/MLCO position really ought to be able to keep abreast with developments, certainly those that impact directly on the sector and organisation that he or she works in. The basics aren’t rocket science. The nuances do take a little more work. Maybe it’s the organisations themselves that devote too little resource to the compliance function, or expect too few compliance staff to cover all the bases.
Yes, this is my concern too, Roy – the basics are available on many courses and workshops, but the continuing, developing, ongoing information is not, and neither is the sharing of war stories and experience (the nuances, as you say). You can learn the building blocks of being an MLRO from a book, but it’s a bit like the theory driving test – it’s only the start, and will never, in isolation, make you safe on the roads.
Best wishes from Susan