It depends on how you provide your services.
Scenario A: You provide the designated service yourself
Examples include:
- You issue or operate a financial product
- You provide custodial or depository services
- You run MDAs directly
- You lend, fund, or deal directly with customer assets
In these cases, you must maintain a full AML/CTF Program (Parts A & B), which includes:
- Part A risk assessment and governance
- Oversight and compliance frameworks
- Training of staff
- Independent review
- Part B customer due diligence and verification
Scenario B: You only perform the item 54 “arranging” service (agent/distributor model)
If you arrange for customers to receive a designated service from a product issuer, and you are not providing any designated service directly, you may be eligible for Special AML/CTF Program (Part B-only)
This is appropriate when:
- The principal provider maintains the full Part A program, and
- Your role is limited to conducting customer identification and following their AML/CTF procedures.
This significantly reduces the compliance burden for small AFSLs.
Scenario C: You don’t provide any designated service
This includes:
- Advice-only businesses
- Intermediaries that do not issue or operate products
- Administrative/support services without product provision
In these cases, you do not need any AML/CTF Program, but the product issuers you work with may still require you to follow their AML/CTF procedures contractually.