FIC reporting failure guidelines issued

The Financial Intelligence Centre (the Centre) has issued Public Compliance Communication 50 (PCC 50), which provides guidance and clarity on the measures a reporter must take to mitigate the loss of intelligence data when remediating and preventing reporting failures. According to the Centre, PCC 50 was made available for consultation comment by accountable institutions, supervisory bodies and all other persons between 18 November 2020 and18 December 2020.

What is the objective of the PCC?

This PCC provides guidance to reporters on certain measures required for the mitigation of loss of intelligence data due to the Centre, where a report was ought to be filed and the reporter has failed to file this report with the Centre, or where a defective report is filed with the Centre. In addition, the PCC provides guidance to reporters on the prevention, remediation and mitigation measures relating to reporting failures and gives clarity on the Directive 3 of 2014 process.

Highlights of PCC50

Lanel Bekker of Moonstone Compliance and Risk Management highlights the following two parts:

Part A: Non-submitted report

Where a reporter becomes aware of a non-submitted report, the reporter must mitigate the loss of intelligence data to the Centre. The Directive 3 process must be followed to notify the Centre of the loss of intelligence data due to a non-submitted report, how this occurred, what the remediation action plan is and ensuring the non-submitted report is filed with the Centre. Upon completion of the Directive 3 process, the reporter must provide the Centre with a formal, written close-out report detailing the steps taken to remediate the non-submitted reports and prevent a re-occurrence of the reporting failure.

Part B: Defective report

A reporter is required to remediate a defective report by using the process as is set out in goAML notice 4A.

  • Defective reports
    • Systems rule failure and rejected report:
      A report that is submitted and then rejected by the reporting system because it fails the validation requirements that apply to the specific report, is not considered to be submitted to the Centre, and the reporter has not discharged its reporting obligation. The reporting entity must resubmit the corrected report within the initial prescribed period as set out in the MLTFC regulations that apply to that report type. There is no additional time provided to a reporter for the final submission of a report.
    • Report content failure:
      A reporter that submits a report that is accepted by the reporting system, where the reporter has captured inaccurate or false information in this report to bypass the reporting system validation rules, has not discharged the reporters reporting obligation. The reporter must remediate this report.
  • Recommendations to limit reporting errors
    • Information required in terms of the MLTFC regulations is contained in Chapter 4 of the MLTFC Regulations.
    • Pre-validation of report information:
      The Centre recommends that reporters conduct pre-validation of all reports before filing reports with the Centre. This is to help prevent reporting failures or rejections. This will also ensure that prescribed and accurate information is reported to the Centre within the prescribed format and time period.
    • Quality reviews and assurance processes:
      Reporting entities should follow a multi-disciplinary approach that will enable them to apply adequate quality control measures and implement assurance processes in order to identify potential issues relating to the submission of a report to the Centre.

Note: Public Compliance Communication 50 (PCC 50) must be read together with the provisions of Directive 3 and goAML Notice 4A

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