The Guidance informs on how financial institutions (FIs) and designated non-financial businesses and professions (DNFBPs) can fulfil their responsibility to conduct ongoing monitoring of customers, including legal persons and arrangements, in order to identify elevated risks, unusual or suspicious transactions, and breaches of financial sanctions. Photo: BVIFSC

The BVI Financial Services Commission (the FSC) and BVI Financial Investigation Agency (the FIA) have issued guidance on ‘An Effective Approach to Ongoing Monitoring’. Photo: VINO/File

The Guidance informs on how financial institutions (FIs) and designated non-financial businesses and professions (DNFBPs) can fulfil their responsibility to conduct ongoing monitoring of customers, including legal persons and arrangements, in order to identify elevated risks, unusual or suspicious transactions, and breaches of financial sanctions.

The Guidance also highlights the importance of complying with the monitoring obligations set out in the Territory’s anti-money laundering, counter-terrorist financing and countering proliferation financing (AML/CFT/CPF) laws and regulations.

Importance of effective ongoing monitoring highlighted

Managing Director/CEO of the FSC, Mr Kenneth Baker in a BVIFSC press release on January 24, 2025, stated: “The issuing of this Guidance signals the importance that the FSC and FIA place on the need for our supervised entities to engage in effective and ongoing monitoring of their customers and their business activities. FSC licensed entities must properly position themselves to identify and collect quality and reliable data, which can help to identify changes that would allow them to adjust their clients’ risk profiles to mitigate against money laundering, terrorist financing, and proliferation financing risks.

“Effective monitoring can be achieved through the employing of adequate systems, proper staff training and supervision, and maintaining data integrity. As such, I implore our licensees to remain vigilant against evolving threats by adhering to relevant legislative requirements and utilising all issued guidance to improve their processes, procedures and controls as they work toward continual improvement.”

‘Mandatory requirements’

The Director of the FIA, Mr Errol George, commented, “Both the FIA and FSC recognise that comprehensive monitoring processes and procedures are mandatory requirements that should be viewed as integral features of proper business conduct. Defining what constitutes unusual behaviour or transaction patterns is the ultimate responsibility of each DNFBP and must be determined based on their understanding of their customer’s profile and ensuing risks.

“As outlined in the Guidance, obligations transcend reporting suspicious activities and require introspection on whether the business relationship should be retained based on the risk presented by the customer. We hope this Guidance will help compel all supervised entities to increase the degree and nature of scrutiny required to effectively monitor their customers.”

The Guidance on an Effective Approach to Ongoing Monitoring is available here on the FSC's website and here on the FIA’s website.