On August 3, 2022, the Brazilian Council for Financial Activities Control (COAF) launched its Electronic Conformity Assessment Form– AVEC 2022 to assess the level of compliance of certain sectors of the industry toward obligations to prevent both money laundering and financing of terrorist activities (Coaf Resolution No. 36/2021). The main procedure is based on an automated inspection form available on the Financial Activities Control System (Siscoaf), through which supervised companies are notified to submit their responses. Therefore, it is advisable that relevant industry actors follow the automatic notifications sent by Siscoaf, since there is a deadline for companies to acknowledge a notification and another deadline for filling in and sending their submission through the platform.
Following the similar trends in past years, AVEC 2022 will be targeting market segments dealing with high amounts of money and that pose risks to official supervisory tasks of money laundering and terrorist financing in the country. The highest concern is how companies have adopted and implemented, in practice, operations compliance policies for ML/FT, namely, prevention of money laundering, financing of terrorism and proliferation of mass destruction weapons. For this year, the Council turned its attention to the following sectors and activities:
AVEC 2022 is not aimed directly at sanctioning supervised companies, but at guiding them on how to fulfill their obligations. On the other hand, the results of the 2022 Assessment are part of Coaf’s criteria to select potential targets for a preliminary investigation. Alongside the response to the electronic form for AVEC 2022, a company or group of companies under the supervision of the Board must keep its documents on the Prevention of Money Laundering and Prevention of Terrorism (PLD/FTP Prevention Compliance Policy) regularly registered and internally adopted. It is a statutory requirement, now established by infra-legal regulations of COAF and Central Bank in the specific group of jewelry, luxury goods and sports transactions.
In practice, companies shall submit their responses to the form available on Siscoaf for AVEC 2022. After receiving and processing the completed forms, Coaf will revert to supervised companies with an assessment on the degree of compliance with their obligations as to PLD/FTP Prevention Compliance Policies. Three specific situations can be illustrated, namely:
AVEC 2022 is an efficient mechanism for evaluating compliance of critical segments for financial activities in Brazil, in addition to operating as a critical self-assessment tool for companies in relation to their internal policies and procedures to combat money laundering and financing terrorism. A compliant driven behavior will prevent entities from being caught unaware in eventual sanctioning processes conducted by Coaf. Therefore, in combination with a submission of relevant information in AVEC 2022 electronic form, it is crucial that companies are up to date with a PLD/FTP Prevention Compliance Policy.
More information about accessing the portal and complying with the AVEC can be found in the COAF Guidelines.
Our Compliance, Financial and Innovation & Technology teams are available to provide any assistance on those matters, as well as in the drafting and validation of a PLD/FTP Prevention Compliance Policy for AVEC 2022. We will be glad to assist you.
Sources: Coaf realiza Avaliação Eletrônica de Conformidade (Avec – 2022) — Português (Brasil) (www.gov.br)
Coauthors: Ana Carolina Gontijo and Manuela Genovese Pedro
