Letter of Appointment - Compliance Commission

A Letter of Appointment (LOA) is a document issued to a licensed Accountant/Accounting Firm by the Compliance Commission (the Commission), authorizing the Accountant/Accounting Firm to conduct a Risk-Based AML/CFT/CPF On-site Examination (OSE) as an Agent of the Commission.

  1. An LOA indemnifies the Accountant/Accounting Firm from any action which may arise in the course of or as a result of an AML OSE conducted by the Accountant/Accounting Firm.
  2. It can be issued to a single accountant, as in the case of a sole proprietorship, who is responsible for the conduct and submission of OSEs.
  3. As previously stated, it can also be issued to an accounting firm, in which case, the LOA issued to the firm lists the licensed public accountants employed with the firm who are authorized to conduct on-site examinations and submit them to the Commission.
  4. All LOAs issued by the Commission expire on the 31st December each year.
  5. Prior to the commencement of any AML/CFT/CPF on-site examination, the accountant/auditor should verify the following:
    • Valid Letter of Appointment?
      An Accountant/Auditor is not authorized to be on the premises of a Designated Non-Financial Business and Profession (DNFBP) to conduct an AML/CFT/CPF on-site examination without a current Letter of Appointment (LOA).
    • Is the DNFBP required to submit to an AML/CFT/CPF On-site examination?
      Only those DNFBPs offering prescribed financial services pursuant to section 4 as outlined below are required to submit to an AML/CFT/CPF on-site examination:

      1. Friendly Society enrolled under the Friendly Societies Act, Chapter 313;
      2. Real Estate Agents and Brokers, when they are involved as real estate broker in  financial transactions for their client concerning the buying or selling of real estate, and with respect to both the vendors and purchasers.
      3. Land developer engaged in the sale or partition or condominiumizing of any part, parcel,lot or condominium unit of any larger tract or lot of land or any development of landinvolving thebuilding of units sharing walls, common areas and utilities.
      4. A person whose business or any part of whose business consists of –
          • buying for the purpose of trade, sale, exchange, or otherwise dealing in any previously owned precious metals or precious stones, whether altering the same after acquisition ornot: or
          • lending of cash on the security of previously owned precious metals or preciousstones of which the person take possession, but not ownership, in expectation of profit, gain or reward.
      5. Trustees, administration managers or investment managers of a superannuation scheme.
      6. Any person in the business of borrowing or lending or investing money;
      7. Any person in the business of administering or managing funds on behalf of other persons;
      8. Any person in the business of acting as trustee in respect of funds of other persons;
      9. Any person in the business of providing financial services that involves the transfer or exchange of funds, including (without limitation) services relating to financial leasing, money transmissions, credit cards, debit cards, treasury certificates, bankers draft and other means of payment, financial guarantees, safekeeping of cash and liquid securities, and money changing; [this EXCLUDES the provision of financial services that consist solely of the provision of financial advice and security guard services within the meaning of the Inquiry Agents and Security Guards Act].
      10. A counsel and attorney or accountant when they engage in, or carry out transactions for a client concerning- (i) the buying and selling of real estate; (ii) a deposit or investment of cash; (iii) the management of client funds or securities; (iv) the management of bank, savings or securities accounts; (v) the organization of contributions for the creation, operation or management of a legal person; (vi) the creation, incorporation, operation or management of a legal person or legal arrangement, and buying and selling of a business entity; (vii) the provision of a registered office or acting as a registered agent; (viii) the acting as or arranging for another person to act as, a nominee shareholder for another person.
      11. An accountant, but only to the extent that the accountant receives cash in the course of that person’s business for the purposes of deposit or investment otherwise than as part of services rendered pursuant to a financial and corporate service provider’s licence.

NB: In any case where the preceding activities form an integral part of the business services or products offered by a financial institution which is regulated by the Central Bank, the Securities Commission, the Registrar of Insurance or the Gaming Board, then for the purposes of the Financial Transactions Reporting Act, such institution is subject to the supervisory control of the regulator that has responsibility for its licensing.

  • Does the DNFBP have written risk-based AML/CFT/CPF Policies & Procedures?
     If there is no written Policies & Procedures document available the DNFBP is required to submit one to the CC within 90 days.
  • What examination period to be covered?
    An AML/CFT/CPF on-site examination usually covers the examination period for one calendar year, 1st January to 30th December or as specified by the Commission.  If more than one year is outstanding the AML/CFT/CPF on-site examination should cover the last year or as specified by the Commission.
  • When is the Report due?
    The on-site examination report must be completed and submitted to the Commission on or before the 30th June of each year following the period covered by the examination or as specified by the Commission.
  • Are there branches? Are records combined or separate?
    Where there are branches and the records are combined, one AML/CFT/CPF on-site examination should be conducted. Where there are branches and the records are not combined at one location, a separate AML/CFT/CPF on-site examination should be conducted for each branch.