MLRO SAR Filing Obligations for SIB Licensees and Registrants (2019-12-18)

Summary

This is a general industry notice issued by CIMA's Securities Supervision Division reminding all entities licensed or registered under the Securities Investment Business Law (SIBL) of the anti-money laundering reporting obligations imposed on their Money-Laundering Reporting Officer (MLRO). It does not create new law but restates existing duties under the Proceeds of Crime Law (POCL) and the Anti-Money Laundering Regulations (AMLRs).

• Internal procedures: MLROs must maintain internal reporting procedures and have access to relevant information.
• Internal SARs: MLROs must receive internal suspicious activity reports (internal SARs) and assess whether such reports give rise to knowledge or suspicion of criminal conduct.
• Filing with the FRA: Where knowledge or suspicion of criminal conduct arises, the MLRO must file a Suspicious Activity Report (SAR) with the Financial Reporting Authority (FRA) without delay.
• Sanctions-related assets: Separate obligations require reporting to the FRA any assets linked to persons or entities subject to targeted financial sanctions under the Terrorism Law and the Proliferation Financing (Prohibition) Law.

The notice warns that failure to comply with these AML/CFT and reporting obligations may constitute a criminal offence, and that MLROs can be held personally liable, including fines or imprisonment, in addition to any consequences for the licensee or registrant itself. Practically, this means SIBL licensees and registrants should confirm their MLROs understand and are actively fulfilling these statutory duties.

Key obligations

• SIBL licensees and registrants must ensure their appointed MLRO is aware of and fulfils obligations under the POCL and AMLRs.
• MLROs must maintain internal reporting procedures relating to the AMLRs and POCL.
• MLROs must have access to information at the licensee/registrant that assists in maintaining internal reporting procedures.
• MLROs must receive internal suspicious activity reports (internal SARs) concerning known or suspected criminal conduct.
• MLROs must determine whether information in an internal SAR gives rise to knowledge or suspicion of criminal conduct.
• Where such knowledge or suspicion arises, MLROs must file a SAR with the Financial Reporting Authority without delay.
• Licensees and registrants must make separate filings with the FRA if they discover assets relating to persons or entities subject to targeted financial sanctions under the Terrorism Law or Proliferation Financing (Prohibition) Law.

Applies to

licensees and registrants under the Securities Investment Business Law (SIBL)