ACPR Regulatory Entity
ACPR is the abbreviation of “Autorité de Contrôle Prudentiel et de Résolution”. It was founded in 2010, being the merger of the French Banking Commission, the Committee for the Credit Card Institutions and Investment Firms (CECEI), and Mutual Insurance Supervisory Authority (ACAM).
Previously, ACPR was known to be Autorité de contrôle prudentiel (ACP). But in 2013, it was renamed ACPR, where it started working with the implementation of the EU’s Bank Recovery and Resolution Directive (BRRD). As a result, it transposed into French Law as the ordinance number 2013-672.
Introduction to ACPR
The Autorité de Contrôle Prudentiel et de Résolution is the independent administrative authority responsible for properly monitoring financial institutions. It monitors all the institutions which are in France. Plus, it is playing a major role in protecting the entire French financial system from the cases of money laundering or terrorist financing.
Three main objectives of ACPR
ACPR generally functions on three main objectives discussed below:
ACPR is responsible for conducting the ongoing regulation and supervision of the French financial system. This regulation ensures that the firms are complying with the financial conduct and the reporting regulations. It even ensures that ACPR is implementing suitable AML/CFT measures. In addition, ACPR is often issuing operating licenses and authorizations to various financial institutions.
Protection of consumers
One significant benefit of ACPR is that it plays a vital role in protecting the customers who are part of financial institutions. It performs on-site checks and even does inspections to provide the institutions with adequate resources. In addition, procedures are implemented to let the institutions comply with AML/CFT regulations that the French government has imposed. ACPR is performing all the regulations through a Joint Unit which it is sharing with Autorité des marches financiers (AMF).
Through the cooperation with Banque de France, ACPR represents France on the global stage, international banking, and insurance bodies. All it is aiming is to promote a convergence within the international financial standards and excellent practices.
ACRP is giving great attention to ensuring that all the firms are meeting the essential AML/CFT regulatory obligations and supporting the French Treasury to develop the domestic AML/CFT legislation. For shaping up the AML/CFT policy, an annual questionnaire is arranged by the ACPR, which is sent to all the financial institutions. Based on that questionnaire, ACPR rates each institution as moderate, low, or even at the high risk.
FCA, FSCA, ASIC, SCB
Four critical areas of ACPR
For the achievement of key missions, ACPR is following four critical areas coming in its way. The first area is granting all the firms with the licensing to legally perform insurance and banking activities.
Secondly, APCR is entailing continuous monitoring to control the financial situation of companies and deal with their operational conditions. The process of monitoring is performed under the solvency and liquidity laws which are applied to all operations.
ACPR is also contributing towards the stability of national and European financial institutions. Recommendations and implementation policies are given to a variety of European community supervisory bodies. It even cooperates with the rest of the responsible authorities who are in the other Member States. Plus, it is playing a major role in protecting the entire French financial system from the cases of money laundering or terrorist financing.
What are the ACPR’s AML/CFT regulations?
Being part of a FATF member state, France has been committed to implementing the basic AML/CFT standards set by intergovernmental organizations. According to the ACPR guidelines, firms should adopt a risk-based approach to all those threats they face. Screening and the transaction monitoring processes should be a significant part of the AML/CFT program.
How to comply with ACPR?
To fully comply with the ACPR money laundering policy, all the obligated firms should:
- Finish the annual questionnaire by ACPR to feed the information related to money laundering or the terrorism financing activity within the authority’s risk assessment model.
- Develop an excellent risk-based AML/CFT program commensurate with the risk profile of all those customers who are part of the firm and the business sector.
- Implement customer diligence measures to make sure that all the customers are trustworthy towards their identities. In addition, they should be open about the specific nature of their company or business.
- Monitor all the transactions to identify any suspicious activity for removing terrorism financing or money laundering situations. Few more suspicious activities are unusual transaction patterns and so on.
- Screen all the customers for negative media stories and even against the lists of politically exposed persons (PEP).
- Along with the screening of customers, their transactions are also investigated against any relevant international sanctions lists. This can be either the EU’s consolidated list or the United Nations Security Council List.
What is the primary role of ACPR?
ACPR is also assisting the French Treasury in terms of drafting laws for both Monetary and Financial Code. In addition, it conducts proper preventive and methodological work under some supervised agencies where an annual questionnaire is submitted to different entities. Implementation is carried out through the basic sector compliance standards and principles. Most of the instruments are also negotiated following the consultative process.
ACPR basic AML/CFT compliance obligations are applied to all insurance companies, financing companies, or credit institutions. It even involves all the payment institutions or the electronic money institutions which are operating in France. In the category of obligated entities, banks, payment services, and insurance companies are also included.
In the compliance penalties, all those firms are included who have at some point violated the AML/CFT compliance obligations. The organization does have the authority to impose specific disciplinary measures on that organization, including some warning or strict action guidelines.
To sum up the whole discussion, ACPR supervisory authority plays a vital role in conducting the on-site inspections of the obligated entities. Implementation is performed through the basic sector compliance standards and few principles. The primary purpose of such checks is to establish the specific suitability of AML/CFT programs that the firms follow all the time. In addition, a firm assessment process is performed for knowing the business’s effectiveness.
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