CySEC’s Circular C655 provides a summary of the results identified during CySEC’s annual risk-based assessment of the Compliance Officer’s Annual Reports and Internal Audit Reports for the year 2022. CySEC’s assessment was based on the adherence of regulated entities to the requirements set out in the Law, the Directive and to the guidance set out in Circular C033 , Circular C186 and Circular C191.
Regulated entities are expected to consider the findings identified in Circular C655 and ensure that the following obligations are upheld in accordance with the Law, the Directive and aforementioned Circulars:
- The Compliance Officers’ obligation for the correct preparation of the Annual Report and the sufficient assessment of the level of compliance of the regulated entity in relation to the prevention of money laundering and terrorist financing.
- The Internal Auditor’s obligation for the correct preparation of the Internal Audit Report and a sufficient review and evaluation of the appropriateness, effectiveness and adequacy of the policy, practices, measures, procedures and control mechanisms applied by the regulated entity for the prevention of money laundering and terrorist financing.
- The regulated entity’s BoD obligation for the sufficient assessment and approval of the Annual Report and the Internal Audit Report and taking all appropriate measures for the correction of any weaknesses and/or deficiencies identified as well as the implementation timeframe of these measures.
- The regulated entity’s BoD obligation to ensure the overall implementation of all requirements of the Law and the Directive as well as to ensure that appropriate, effective and sufficient systems and controls are introduced for achieving the abovementioned requirement.
CySEC highlights that regulated entities should be aware that common and recurring weaknesses and deficiencies will be the subject of rigorous compliance checks by the CySEC and expects that all Regulated Entities should consider the mentioned findings when preparing the reports for the calendar year 2023 and onwards.