Broker-Dealer Anti-Money Laundering Compliance
AML Program Development, Testing and Regulatory Support
Anti-money laundering compliance is an ongoing component of a broker-dealer’s supervisory and risk-management responsibilities.
Broker-dealers must establish and maintain AML programs appropriate to their businesses and reasonably designed to address applicable Bank Secrecy Act requirements and FINRA Rule 3310. An effective program requires more than written policies: firms must consider their customers, products and services, transaction activity, geographic exposure, business model, and other relevant risk factors.
The LeGaye Law Group assists broker-dealers in developing, implementing, reviewing, testing, and enhancing AML compliance programs. Our services can address AML policies and procedures, independent testing, training, customer identification and due diligence, suspicious activity reporting, Bank Secrecy Act reporting, OFAC-related compliance, and the evaluation of technology supporting transaction monitoring and suspicious-activity detection.
AML Policies and Procedures
A broker-dealer’s written AML program should reflect the firm’s actual business rather than serve as a generic policy document. We assist firms in developing and updating AML policies and procedures based on their business activities, customer relationships, products and services, methods of conducting business, and identified risks.
AML Risk Assessments
The AML risk assessment provides a foundation for evaluating whether a firm’s program and controls are appropriate for the risks posed by its business. We assist broker-dealers in assessing AML risks associated with customers, products, services, transactions, geographic exposure, distribution channels, and other characteristics of the firm’s operations.
The risk assessment can then be used to evaluate whether the firm’s policies, monitoring, escalation procedures, training, and testing appropriately address the identified risks.
Customer Identification and Customer Due Diligence
Understanding the firm’s customers and the risks associated with those relationships is central to an AML program. We assist broker-dealers in evaluating Customer Identification Program (CIP) and Customer Due Diligence (CDD) procedures, including processes for legal-entity customers and beneficial ownership, where applicable.
Suspicious Activity Monitoring and Reporting
Broker-dealers should have processes to identify, investigate, escalate, document, and, where required, report suspicious activity. We assist firms in evaluating whether their procedures appropriately address the types of activity presented by their business model. This may include reviewing escalation procedures, documentation standards, responsibilities for investigating alerts, and the firm’s processes for Suspicious Activity Reports.
When technology is used for transaction monitoring or suspicious-activity detection, the firm’s procedures and supervisory framework should reflect how those systems are used in practice.
OFAC and Sanctions Compliance
AML programs frequently intersect with OFAC and other sanctions requirements. We help firms review procedures for sanctions screening, escalation of potential matches, documentation, and coordination with customer onboarding and transaction monitoring.
Independent AML Testing
Independent testing gives a broker-dealer the opportunity to assess whether its AML program is functioning as intended and whether its written procedures align with actual practices. The LeGaye Law Group provides independent AML program testing as part of its AML and compliance services.
Testing may include a review of the firm’s written AML program, risk assessment, customer identification and due diligence processes, transaction-monitoring controls, suspicious-activity procedures, training, documentation, and remediation of prior findings. After testing, we can identify findings and observations for management and help the firm evaluate appropriate corrective measures.
AML Training
A written AML program is effective only if personnel understand their responsibilities. We assist firms in developing and delivering AML training tailored to their business activities and personnel responsibilities. Training can cover regulatory requirements, the firm’s policies and procedures, escalation responsibilities, suspicious-activity indicators, customer due diligence, and developments affecting the firm’s AML program.
Evolving AML/CFT Expectations
AML requirements continue to evolve. We help firms evaluate regulatory developments and determine whether changes to their risk assessments, policies, procedures, controls, testing, or training are appropriate. When regulatory initiatives remain proposed rather than final, we distinguish those developments from existing requirements.
AML as Part of the Broader Compliance Program
AML does not operate in isolation from the rest of a broker-dealer’s compliance program. Customer onboarding, books and records, supervisory systems, communications, financial activity, cybersecurity, and regulatory reporting may intersect with AML responsibilities.
For firms receiving our Ongoing Regulatory Compliance Services, AML support can be integrated into the firm’s broader compliance program so that policies, testing, training, and remediation are addressed within a coordinated regulatory framework.
Learn More About Our Ongoing Regulatory Compliance Services →
Strengthen Your Broker-Dealer’s AML Program
Whether your firm needs assistance developing or updating its AML program, conducting independent testing, evaluating its AML risk assessment, providing training, or addressing an identified deficiency, The LeGaye Law Group can provide regulatory and compliance support tailored to your firm’s business.