AML-CFT: Cost of Compliance

The Cost of Compliance for AML-CFT regime may differ from one institution to another institution. There are nevertheless some common costs incurred by a country that are not directly "absorbed" by a reporting institution. Example of costs incurred to establish AML-CFT legislation include items such as administrative costs, fees paid to experts, exposure drafts and various parlimentary readings and discussions. For financial institutions, costs could further be classified as "Prompted responses" and "Unprompted responses". Costs under the category of prompted responses include Training/professional development; Staff recruitment; Staff salaries; Monitoring software establishment; Software recurrent and External consultancy. Meanwhile, unprompted responses include Record keeping; monitoring; reporting; purchase of equipment or hardware; admin costs and customer relations. It is worth noting that reporting institutions are institutions that have been identified by the "AML-CFT Competent Authority - in Malaysia, this is Bank Negara Malaysia or BNM" who are expected to facilitate BNM by submitting "suspicious transaction reports or STR". Beside financial institutions, other reporting institutions are legal firms; accounting & auditing firms; company secretaries; casino; gem or metal dealers; money changers.