Update for supervised entities published: Identification of terrorist financing risk is important – Terrorism also being financed from Finland

Update for supervised entities published: Identification of terrorist financing risk is important - Terrorism also being financed from Finland

The FIN-FSA has published an update on identifying terrorist financing risks. According to the Finnish Security and Intelligence Service (Supo), terrorism is being financed also from Finland to other countries. The financial sector plays a key role in identifying terrorist financing risks and preventing terrorist financing at an early stage.

The FIN-FSA reminds that combating terrorist financing is an independent framework alongside the anti-money laundering, requiring separate risk identification and management. An approach solely based on money laundering indicators is not usually sufficient to identify terrorist financing risks, as the key risk is often concerned with the intended use and recipient of the funds, rather than their origin.

Supervised entities must:

• identify terrorist financing risks as part of their own risk assessment
• take the specific characteristics of the risks into account in products, customer relationships, distribution channels and geographical connections
• scale terrorist financing risk management methods based on risks
• monitor changes in the risk environment (e.g. geopolitical conflicts, new payment methods).

Terrorist financing risks are dynamic in nature and may also be linked to legitimate activities as well as small and apparently ordinary transactions.

In addition, supervised entities must consider the connection to international sanctions as well as related humanitarian exemptions.

For further information, please contact

Pekka Vasara, Head of Division, Anti Money Laundering, pekka.vasara(at)fiva.fi or telephone +358 9 183 5513

Appendix

Update for supervised entities

Keywords

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