GC13/3 Examples of good and poor practice in ‘Banks’ control of financial crime risks in trade finance’

Published: 02/07/2013     Last Modified: 02/07/2013

This proposed guidance relates to the following rule(s) in the FCA Handbook 

  • SYSC 6.1.1R and SYSC 6.3

The full guidance: GC13/3 Examples of good and poor practice in ‘Banks’ control of financial crime risks in trade finance’

This guidance is likely to be of most relevance to banks.

Background to this consultation

We carried out a thematic review of banks’ control of financial crime risks in trade finance. We found that banks generally had effective controls to ensure they were not dealing with sanctioned individuals or entities, but not in relation to anti-money laundering and transactions involving ‘dual-use’ goods’.

We set out examples of good and poor practice in our thematic review. We propose to include these examples in a new chapter in Part 2 of Financial crime: a guide for firms, our regulatory guidance setting out our expectations of firms’ financial crime systems and controls.

We believe that this guidance will make clear our expectations of firms’ management of the financial crime risk associated with trade finance, improve the level of compliance across the sector, level the playing field for firms and ultimately lead to a reduction in financial crime.

Summary of the key issues

The proposed guidance sets out examples of good and poor practice to help banks strengthen their financial crime systems and controls in trade finance.

Cost benefit analysis 

A CBA is not included in this consultation as the proposed guidance follows predictably from existing rules. The Chief Economist Department has confirmed this is an appropriate reason for not doing a CBA for this type of guidance. 

We invite your views on

  • our proposed examples of good and poor practice.

Please respond by 4 October 2013 

Please email your responses to

Carolin Gardner

Or send your responses to:

Carolin Gardner
Financial Crime and Intelligence Department
The Financial Conduct Authority
25 The North Colonnade
London E14 5HS
Telephone: 020 7066 0406

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