Which findings indicate issues that would cause a lack of understanding of the risks associated with the business the financial institution conducts? (Select Three.)
This highlights fundamental gaps in the risk assessment process. A lack of clarity in identifying and analyzing risks associated with certain products, services, or client categories reflects an incomplete understanding of the business's risk landscape.
CAMS-Audit emphasizes the importance of comprehensive risk assessments to identify inherent and residual risks and align them with the institution's overall AML/CFT framework.
Finding 4
This pertains to inadequate integration of risk mitigation controls into operational processes, leading to blind spots in identifying emerging threats. Institutions that do not properly embed risk controls often fail to adapt to changing business or regulatory requirements.
Reference to FATF recommendations underlines the necessity of embedding controls that reflect ongoing and emerging risks.
Finding 8
Failure to implement effective monitoring mechanisms or maintain updated customer or transaction profiles suggests a superficial approach to understanding risk exposure. Without robust data tracking, financial institutions may overlook key risk indicators.
CAMS-Audit documents stress the need for effective transaction and customer profile monitoring systems as part of a sound risk-based approach.
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