The financial landscape is under unprecedented regulatory scrutiny, with anti-money laundering (AML) compliance becoming a top priority for institutions worldwide. While securitization provides a powerful mechanism for capital market efficiency, its multi-layered structure and complex cash flows can create unique vulnerabilities to illicit financial activities. Professionals who fail to integrate robust AML protocols into the securitization process expose themselves and their organizations to significant legal, financial, and reputational risks. This course is meticulously designed to bridge the knowledge gap, equipping participants with the expertise to identify, mitigate, and manage AML risks throughout the entire securitization lifecycle.

This intensive 10-day training course goes beyond theoretical knowledge, offering a practical and comprehensive guide to building a resilient AML compliance framework for securitization transactions. We will explore the responsibilities of each key party, from the asset originator to the end investor, and analyze how regulatory standards like the Financial Action Task Force (FATF) recommendations and local laws apply. Through a combination of in-depth lectures and practical case studies, you will learn to implement effective due diligence, recognize red flags, and ensure that your transactions not only meet market demands but also uphold the highest standards of financial integrity and regulatory compliance.

Duration

10 days

Target Audience

• Compliance officers and AML specialists
• Structured finance professionals and securitization analysts
• Risk managers and internal auditors
• Legal and regulatory professionals in finance
• Investment bankers and underwriters
• Professionals at credit rating agencies
• Senior management and board members
• Financial regulators and policymakers

Objectives

• Master the core principles of anti-money laundering and counter-terrorist financing.
• Identify specific AML risks inherent in securitization transactions.
• Understand the role and compliance responsibilities of each transaction party.
• Develop a robust AML risk-based approach for securitized deals.
• Implement effective customer and enhanced due diligence procedures.
• Learn to monitor transactions for suspicious activities and red flags.
• Navigate the regulatory requirements for suspicious activity reporting.
• Analyze how AML compliance impacts deal structure and documentation.
• Understand the legal and financial penalties for non-compliance.

Course Modules

Module 1: The Foundations of AML Compliance

• An overview of money laundering and terrorist financing.
• Key international AML standards and organizations (e.g., FATF).
• The concept of a risk-based approach to compliance.
• The essential components of an effective AML program.
• The legal and ethical obligations of financial institutions.

Module 2: AML Risks in Securitization

• An analysis of how securitization can be vulnerable to money laundering.
• The risk of using illicit funds to purchase assets.
• The challenge of conducting due diligence on a large pool of assets.
• The potential for illicit funds to enter through investors.
• The risk of using complex structures to obscure ownership.

Module 3: Global AML Regulatory Frameworks

• The key provisions of the Bank Secrecy Act (BSA).
• An overview of the Fourth and Fifth EU Anti-Money Laundering Directives.
• Understanding the role of key AML regulators.
• The extraterritorial reach of AML laws.
• The importance of a global compliance strategy.

Module 4: Risk Assessment for Securitization Deals

• Conducting a comprehensive AML risk assessment for a transaction.
• Factors that influence the risk rating of a deal.
• The importance of the asset class in the risk assessment.
• The role of the jurisdiction of the originator and investors.
• How to document and maintain the risk assessment.

Module 5: Customer Due Diligence (CDD) in Securitization

• Applying CDD principles to the transaction's parties.
• Verifying the identity of the originator and servicer.
• The importance of beneficial ownership identification.
• Conducting checks on transaction counterparties.
• Ongoing monitoring of the parties' identities.

Module 6: Enhanced Due Diligence (EDD) Procedures

• When and why to apply enhanced due diligence.
• The triggers for EDD, such as high-risk jurisdictions or PEPs.
• The process of gathering and verifying additional information.
• The specific EDD procedures for securitization investors.
• Managing the documentation and record-keeping for EDD.

Module 7: The Originator's Role in AML Compliance

• The originator's responsibility to screen assets for illicit origins.
• The importance of a robust AML program at the asset level.
• The representations and warranties regarding asset cleanliness.
• The legal recourse for the SPV if assets are found to be tainted.
• Best practices for asset onboarding and screening.

Module 8: The SPV's and Trustee's Obligations

• The legal and compliance obligations of the Special Purpose Vehicle.
• The role of the trustee in a securitization deal.
• The importance of the trustee's independent AML program.
• The legal requirement to prevent commingling of funds.
• How the trust deed addresses AML compliance.

Module 9: The Servicer's AML Duties

• The servicer's role in the ongoing monitoring of the asset pool.
• How to handle cash flows and identify unusual patterns.
• The importance of customer-facing AML procedures.
• The contractual provisions that define the servicer's duties.
• The legal and reputational risks of a servicer's failure.

Module 10: Investor Due Diligence and Onboarding

• The challenge of screening investors in a securitization offering.
• The use of subscription agreements to collect AML information.
• The role of a placement agent in investor due diligence.
• The ongoing obligation to screen investors and their activities.
• Managing the risk of politically exposed persons (PEPs).

Module 11: Transaction Monitoring and Suspicious Activity Reporting

• The process of monitoring cash flows and transactions for red flags.
• Examples of suspicious activity in a securitization context.
• The internal process for escalating potential issues.
• The legal obligation to file Suspicious Activity Reports (SARs).
• The importance of clear documentation for a SAR.

Module 12: Legal Documentation and Clauses

• The inclusion of specific AML representations and warranties.
• Covenants that require parties to maintain AML programs.
• The language that allows for the termination of a deal.
• Indemnification clauses for AML-related legal issues.
• The importance of a well-defined legal framework.

Module 13: Technology and AML Compliance

• The role of RegTech in automating AML processes.
• Using data analytics to detect suspicious patterns.
• The benefits of AI and machine learning in transaction monitoring.
• The legal and regulatory challenges of using new technologies.
• A review of available AML software solutions.

Module 14: Enforcement, Penalties, and Case Studies

• An overview of the penalties for non-compliance.
• The role of regulatory bodies in enforcing AML laws.
• A deep dive into a real-world AML failure in a securitization deal.
• The financial, legal, and reputational consequences of the failure.
• Lessons learned from historical AML cases.

Training Approach

This course will be delivered by our skilled trainers who have vast knowledge and experience as expert professionals in the fields. The course is taught in English and through a mix of theory, practical activities, group discussion and case studies. Course manuals and additional training materials will be provided to the participants upon completion of the training.

Tailor-Made Course

This course can also be tailor-made to meet organization requirement. For further inquiries, please contact us on: Email: info@skillsforafrica.org, training@skillsforafrica.org  Tel: +254 702 249 449

Training Venue

The training will be held at our Skills for Africa Training Institute Training Centre. We also offer training for a group at requested location all over the world. The course fee covers the course tuition, training materials, two break refreshments, and buffet lunch.

Visa application, travel expenses, airport transfers, dinners, accommodation, insurance, and other personal expenses are catered by the participant

Certification

Participants will be issued with Skills for Africa Training Institute certificate upon completion of this course.

Airport Pickup and Accommodation

Airport pickup and accommodation is arranged upon request. For booking contact our Training Coordinator through Email: info@skillsforafrica.org, training@skillsforafrica.org  Tel: +254 702 249 449

Terms of Payment: Unless otherwise agreed between the two parties’ payment of the course fee should be done 7 working days before commencement of the training.