An Independent AML Audit is a systematic examination of how effectively your institution’s AML and Counter-Financing of Terrorism (CFT) policies, procedures, and controls work in practice. It is typically conducted by qualified external auditors, like A&D Forensics, or by an internal team that operates independently from daily AML functions to ensure an unbiased assessment.
The Challenge
A cryptocurrency exchange platform with operations in Nigeria, Kenya, Ghana and other African countries engaged A&D Forensics to conduct an Independent AML Audit. The primary objective was to assess its compliance with applicable AML/CFT regulations across different jurisdictions, primarily Nigeria, evaluate the effectiveness of its internal control framework, and identify implementation gaps across critical compliance functions.
With increasing regulatory scrutiny and evolving financial crime risks in the digital asset space, the crypto exchange sought to strengthen its internal systems and ensure its policies and practices aligned with regulatory expectations and global best practices.
Our Approach.
A&D Forensics adopted a three-pronged Independent AML Audit methodology to deliver a comprehensive compliance assessment:
- Structured Questionnaires: Tailored to extract critical compliance information across all functional areas.
- Key Personnel Interviews: In-depth discussions with compliance, operations, engineering and risk teams to understand implementation realities.
- Documentation Review & Testing: Rigorous evaluation of policies, procedures, training records, and customer files, along with limited testing of selected controls and evidentiary samples.
The Solution
The A&D Forensics Independent AML Audit team began by engaging with the crypto exchange to understand its AML/CFT compliance needs, the AML audit scope, its crypto products and services, and the existing governance structure. A detailed timeline and audit plan was mutually agreed upon, outlining key milestones, document submissions, and interview phases.
Our AML Audit team reviewed the documents and conducted interviews with relevant personnel across compliance, risk, engineering, and operations to gain insights into the practical application of controls from onboarding to suspicious activity reporting.
The Independent AML Audit covered nine critical compliance areas, including governance, regulatory adherence, risk assessment, due diligence, transaction monitoring, internal controls, training, record-keeping, and reporting. Each module was assessed based on local regulatory frameworks, notably Nigerian AML/CFT laws, and aligned with global standards.
Findings revealed strengths in training and record-keeping but also identified key gaps, particularly in outdated documentation, lack of formal risk governance, and absence of an internal audit function. As part of the solution, we provided detailed, actionable recommendations and supported the client in prioritizing remediation steps.
By the end of the engagement, the crypto exchange had a clear roadmap to strengthen its internal control environment, enhance documentation, and align more closely with evolving regulatory expectations.
Benefits of Independent AML Audit.
Here are 5 key benefits of an Independent AML Audit for financial institutions and cryptocurrency exchanges:
- Objective Risk Assessment: An Independent AML audit provides an unbiased review of your AML/CFT framework, helping you identify blind spots and weaknesses that internal teams may overlook.
- Regulatory Confidence & Compliance Assurance: Regulators expect institutions to demonstrate strong AML controls. An Independent AML Audit shows commitment to compliance, reducing the risk of penalties, fines, or license suspensions.
- Enhanced Detection & Prevention of Financial Crime: Through rigorous testing of your transaction monitoring, customer due diligence, and reporting systems, an Independent AML Audit ensures suspicious activities and high-risk exposures are identified early.
- Improved Internal Controls & Governance: Insights and recommendations from an Independent AML Audit strengthen your internal policies, procedures, and staff training, fostering a culture of compliance and accountability.
- Market Reputation & Business Trust: By demonstrating that your AML framework has been independently validated, an Independent AML Audit builds credibility and trust with customers, investors, and banking partners, essential for both financial institutions and crypto exchanges.
Ready to Strengthen Your AML Compliance Framework?
At A&D Forensics, we help crypto businesses stay ahead of regulatory expectations through tailored Independent AML Audit, risk assessments, and strategic compliance support. Whether you’re looking to validate your controls, update outdated procedures, or build a more resilient compliance program, we’re here to help.
Contact us today to schedule your Independent AML Audit or learn how our services can support your compliance journey.
Email: contactus@adforensics.com.ng
Website: https://adforensics.com.ng/