As I perform annual independent AML reviews across the country, I run across the same issues time and time again, the biggest of which is training not being performed either on time or at all. Title 31 of the US code, otherwise known as the USA PATRIOT Act, requires that all precious metals dealers required to have an AML program must train their staff on the following occasions:
- Within 30 days of hire
- Annually as a refresher
- Anytime the law changes
Employees who require training are those who interact with customers at the loan and sales counters, are in administration or are on the Board. Basically, if they handle cash or are in charge of those who do, then training is required. Those who do online sales or other services like warehouse work or jewelry repair are excluded from the requirement.
To pass muster, there needs to be good documentation of training. Be sure to record:
- What was discussed with some detail
- Who attended the training
- Who presented the training
- The date of the training
Attendees should sign a register or some sort of document that proves they were there along with what training they received. These documents should be retained for a minimum of 5 years before they are destroyed.
Training topics need to include the following at a minimum:
- Money laundering defined with examples provided
- What suspicious activity looks like and how it is handled
- Indications for use of a SAR and who will be filing these
- Indications for use of an 8300 form and who will be filing these
- The four pillars of the AML program
- Record retention requirements
- OFAC and SDN lookup requirements and your procedures
- GLBA, privacy and safeguard requirements
- Proper Customer identification procedures
- Know your Customer and Enhanced Due Diligence procedures
Training can be provided in one-on-one or group settings or you can use an online resource. A test is not required if done in a setting that allows for back and forth so all questions can be answered. Ultimately, the compliance officer needs to feel confident that those being trained walk away informed and that actual learning took place. If this is not guaranteed, then a written test should be incorporated.
The importance of this piece of the AML program can’t be overstated. If you think about the 4 pillars, this is the one that lies squarely on the compliance officer’s shoulders. If they are not on top of the training, it will show during a review. It only takes the IRS folks about 5 minutes to identify whether or not a company has their act together or is trying to bluff their way through an exam. Those identified as having their act together sail through exams practically stress-free. Those who do not have their act together will feel as if they were tortured.
If you need help with training or want to run what you are currently doing past us to see if you are covered, we are here to help!