4.1.4. New Technologies Risk
Effective from 11/11/2021Under Article 23 of the AML-CFT Decision and Paragraphs 16.2.3 and 16.2.7 of the Standards, LEH must identify, assess, understand, and mitigate the ML/FT risk to which they may be exposed by new technologies, including new delivery mechanisms and the use of new or developing technologies for both new and existing products. LEH must undertake the risk assessment prior to obtaining approval from the CBUAE to launch or use such products, services, and technologies if applicable.
| 1. | IDENTIFY: LEH should identify the new technologies they plan to introduce. New technologies can involve new or modified products and services and also new or modified delivery channels. | |
| 2. | ASSESS: The LEH should assign an inherent risk to each proposed new technology. Determining the risk of new technologies should include a consideration of their characteristics and attributes. In addition to the factors listed above under sections 4.1.2 and 4.1.3, this could include factors such as features of the technology that promote anonymity or obstruct access to transaction or customer information, a history of ML/FT abuse of the technology, the inherent risk of the target customer and market segments that are projected to use the new technology, and expected growth in use of the technology. | |
| 3. | CALCULATE EXPOSURE: The LEH should consider the projected or expected volume of transactional activity associated with the new technology and follow the procedure described in sections 4.1.2 and 4.1.3 above. | |
| 4. | DOCUMENT: A LEH’s approach to categorizing risk should be clearly documented. The LEH should keep detailed records of its assumptions, statistics used to complete this process, and the resulting analysis and outcomes. | |