During October 2019 the Financial Intelligence Centre (FIC) published the draft Public Compliance Communication 103 which provided guidance to the NPO sector, NPO Regulators and third parties dealing with NPOs, regarding measures that could be implemented in order to combat terrorist financing and money laundering risks within the NPO sector. The draft PCC was made available for comment until 7 November 2019. The comments received were considered and the FIC have recently published the final version of the guidance as Public Compliance Communication 41 (PCC 41).
Third parties that deal with NPOs include accountable institutions (such as financial services providers), reporting institutions (such as motor vehicle dealers), donors, service providers, and partners. Third parties are urged to follow a risk based approach when transacting with NPOs and implement the necessary measures when dealing with NPOs that pose a high risk from a terrorist financing and money laundering perspective such as establishing a risk rating of NPOs as this not only protects the third parties but also makes it easier for third parties to minimise their risk of sanctions in the future.
The FIC advises that accountable institutions must comply with the requirements set out in the FIC Act, and the accountable institution’s Risk Management and Compliance Programme (RMCP). FSPs, especially those dealing with NPOs, are urged to consider the information contained in PCC 41 and to update their RMCP as necessary.