Regulatory Alerts2021-01-26
Added · Updated
Good Practice Integrity Risk Appetite
The Dutch Central Bank (DNB) provides guidance on formulating and embedding an integrity risk appetite within financial institutions, emphasizing the scope, senior management responsibility, and operational integration of this framework. The document outlines the three lines of defense model, assigning specific roles to business units, risk/compliance functions, and internal audit in defining, monitoring, and auditing integrity risks. It also addresses de-risking practices, encouraging institutions to manage high-risk clients through specialized teams rather than categorical exclusion, provided individual risk assessments are conducted. This guidance is non-binding and aims to help institutions align their integrity risk management with strategic objectives and regulatory expectations.