Question 3 \"In year 2012, the Financial Action Task Force {FATF} updated its Recommendations to strengthen global safeguards and to further protect the integrity of the nancial system by providing governments with stronger tools to take action against nancial crime." One of the most important changes was the increased emphasis on the RBA to AMUCFI', especially in relation to preventive measures and supervision. While the 2003 Recommendations provided for the application of an RBA in some areas, the 2012 Recommendations consider the RBA to be an 'essential foundation' of a country's AMLiCFT framework. This is an overarching requirement applicable to all relevant FATF Recommendations. According to the Introduction to the 40 Recommendations, the RBA: 'allows countries, within the framework of the FATF requirements, to adopt a more exible set of measures in order to target their resources more effectively and apply preventive measures that are commensurate to the nature of risks, in orderto focus their efforts in the most effective way'. (FA TF Guidance for a Risk Based Approach The Banking Sector - 2014) Senior Management plays an important role in the succesle implementation of REA in any organisation. Based on the above Guidance published by FATF, you are required to attend to the following: a) What is your understanding of RBA in AMUCFT? (5 marks) b) Discuss the role of Senior Management in ensuring the successful implementation of the RBA in your bank. (10 marks)- c) Explain the potential benets and challenges faced by Reporting Institutions when applying the RBA to their AMUCFI' programme. (10 marks)