Under the new advice regime now in place, a licensed financial advice provider (FAP) that takes on a former authorised financial adviser (or AFA, now known as a financial adviser) with AML/CFT obligations, takes on those obligations itself as part of the package.  

If the adviser is employed by a licensed FAP, then that FAP becomes the AML reporting entity. But if the adviser is employed by an authorised body, then it is the authorised body that becomes the AML reporting entity.

Regardless of whether it is the FAP or authorised body that becomes the reporting entity in AML terms, FAP license holders have an obligation to ensure all their authorised bodies are compliant. This will involve identifying who was previously an AFA and provided investment advice and whether they were previously captured as a reporting entity.

As a result, a number of authorised bodies will need to become AML reporting entities themselves and pick up this obligation. Most of these entities will have 2021 as their audit year so they will need to start working quickly to get this sorted.

Strategi Institute can help with AML/CFT manuals, templates and training modules, while Strategi Compliance can provide the AML audits for FAPs or authorised bodies needing assistance in this area. If the authorised bodies have not already done so, they will need to review and amend their AML risk assessment and programme, to reflect their new legal status. We are happy to talk you through all this and explain just what needs to happen.

Ring now to make sure you’re on top of this important regulatory requirement.