Subject: New FIAU Publication: Thematic Review on Simplified Due Diligence by CISs
The FIAU has published a new document titled Application of Simplified Due Diligence by Collective Investment Schemes – Thematic Review 2023, developed in collaboration with the Malta Financial Services Authority (MFSA).
This publication provides practical, sector-specific insights into how Collective Investment Schemes (CISs) are applying Simplified Due Diligence (SDD) when dealing with customers carrying out relevant financial business, whether investing on their own behalf or acting as nominees for underlying investors.
The review highlights:
- Strong practices adopted by many CISs in gathering information and building customer profiles
- Key gaps, particularly around understanding expected activity levels and the nature of customers’ business
- Challenges in documenting Customer Risk Assessments and ensuring ongoing monitoring is meaningful
- Examples of good and bad practices, helping subject persons benchmark their own frameworks
- Clear takeaways and recommendations to support more effective, risk‑sensitive SDD implementation
The findings reinforce an important message: Not all regulated entities automatically present a low ML/FT risk. A well‑informed, well‑documented assessment remains essential.
With the CIS sector’s size, complexity, and international reach, consistent application of AML/CFT safeguards is critical. This publication aims to support subject persons in strengthening their controls, improving monitoring, and ensuring SDD is applied only where justified.
You may access the full document on the website.
If you have any questions regarding the publication or its implications for your obligations, please contact the FIAU’s Supervision Section at [email protected].