Financial Crime Compliance Working Group

Purpose

The purpose of the Financial Crime Compliance Working Group (FCC WG) is to foster best practice across a broad spectrum of financial crime-related risks that could arise in the Securities Services industry.

Scope

ISSA Questionnaire Review

In August 2015, ISSA released 17 Principles which are recommended to be implemented by the global community of securities custodians and intermediaries in order to address the critical challenges posed by financial crime, particularly where omnibus and commingled account structures are used. The WG’s scope includes reviewing these principles, and related Due Diligence Questionnaire, on an ongoing basis.

Additional, in scope topics for 2023 include:

Asset Class and New Technologies Risk Review

  • Phase I: Outline the risk dimensions for different asset classes, from traditional assets to emerging assets such as crypto currencies and digital assets
  • Phase II: Assess new technologies and the different risks they pose

Geopolitical Impacts Forum

  • Create a group to pool and share information on geopolitical impacts including, but not limited to, sanctions

Key Deliverables

The key deliverables will be:

  • A risk matrix of both traditional and emerging asset classes outlining their different risk factors
  • An inventory of new technologies and their risk dimensions
  • A review of the Principles and ISSA Questionnaire to understand whether additional questions need to be added to the ISSA Questionnaire to mitigate the risks of the different asset classes and new technologies
  • An updated ISSA Questionnaire

Key Outcomes

  • To ensure that the risk dimensions of different asset classes and new technologies are included as part of the due diligence undertaken when assessing existing new and existing clients
  • To have an up to date and complete ISSA Questionnaire that takes into consideration the risk dimensions of the different asset classes and new technologies
  • To master geopolitical impacts on financial crime compliance

Bulletins.

Reports

Principles and Related Documents

  • SWIFT KYC Registry Factsheet NBFI (2022) > PDF 30 kB
  • ISSA Financial Crime Compliance – Revised Questionnaire (ISSA DDQ) version 12/2021 > DOC 3 MB
  • Examples of Draft Contractual Terms to Support the Implementation of the Principles 05/2019
    > PDF 211 kB
  • Background & Overview on the Financial Crime Compliance Principles 05/2019
    > PDF 574 kB
  • Discussion paper on Transparency in Securities Transaction and Custody Chains, issued on 22 April 2014, as pre-reading documentation for the ISSA Symposium 17.
    > PDF 360 kB

Additional Documents

  • ISSA Comments to BIS’s consultative document of October 21, 2015
    > PDF 414 kB
  • ISSA commissioned Study on the Benefits and Costs of Securities Accounting Systems, August 20, 2015
    > PDF 950 kB

Working Group Co-Chairs

Mark Gem, Clearstream
Olivier Goffard, Euroclear

Executive Sponsor

Margaret Harwood-Jones, Standard Chartered Bank

Institutions Represented by Experts in the Working Group

  • Aite Novarica
  • Banque Internationale à Luxembourg
  • BNY Mellon
  • Citibank
  • Clearstream
  • Cognizant
  • Credit Suisse
  • Deutsche Bank
  • Deutsche Börse Group
  • DTCC
  • Euroclear
  • HSBC
  • ISSA
  • JP Morgan
  • SEB
  • SIX
  • Standard Chartered Bank
  • SWIFT
  • The Mauritius Commercial Bank
  • UBS
  • Winterflood Securities

“All you need to know about FCCPs” video series

Table of contents video
Background of ISSA FCCP
What did ISSA do about it?
How FCCPs line up with similar regulatory norms
Definitions
Main requirements prescribed by ISSA FCCP
Governance
Due diligence
Third party client business