How should the guidance be used?
The Guidance gives firms a degree of discretion in how they comply with AML/CTF legislation and regulation, and on the procedures that they put in place for this purpose.
It is not intended that the Guidance be applied unthinkingly, as a checklist of steps to take. Firms should encourage their staff to 'think risk' as they carry out their duties within the legal and regulatory framework governing AML/CTF.
The FCA has made clear its expectation that FCA-regulated firms address their management of risk in a thoughtful and considered way, and establish and maintain systems and procedures that are appropriate, and proportionate to the risks identified. The Guidance assists firms to do this.
When provisions of the statutory requirements and of FCA's regulatory requirements are directly described in the text of the Guidance, it uses the term must, indicating that these provisions are mandatory.
In other cases, the Guidance uses the term should to indicate ways in which the statutory and regulatory requirements may be satisfied, but allowing for alternative means of meeting the requirements. References to 'must' and 'should' in the text should therefore be construed accordingly.