1. Mobile Banking – Risk Assessment
Simon Kingsbury

3. Key Risks for Mobile Services in Nigeria
Risk / Consideration
Subscriber Identification
ID infrastructure
Lack of National Identity infrastructure in Nigeria presents CIP challenges for subscriber on-boarding
National Identity Management Commission (NIMC) is integrating various government ID data base to come up a master database to enhance Nigeria ID infrastructure. ID database will include fingerprint biometrics
Subscriber SIM registration will be completed by end Sep MNO required to collect Name, telephone number & finger print biometrics for all subscribers
Agent Management
Credible network
Need a robust approach to create the agent network – scale to on-board super and sub agents and perform full KYC
Need a comprehensive operational process to acquire, incentivise and manage thousands of agents
Well defined exception handling process
Operations and Technology resource scale to manage agent network and ensure prescribed controls are in place
Possibility to partner with suitable GTS customers and leverage their network as agents e.g. MNOs, downstream oil& gas companies, large retailers, the Post Office, etc.
Compliance / AML Monitoring infrastructure
Capability to deal with high transaction volume
Customer and transaction volume significantly higher than corporate or retail banking volumes. Robust AML Operations and Technology infrastructure needed to adequately support these large volumes 3

4. AML Monitoring - Customers
While expected activity has been articulated the monitoring program is designed to flag known risks and identify emerging typologies.
Typology / Risk
Limits / Controls
Analytics
Justification
Behavioural Change - (Domestic Transfers)
Mantas Change in Behaviour monitoring
Monthly report identifying increases in total domestic funds transfer amount for a single client compared to previous 12 month average.
Analysis around all domestic transfers conducted by a client will be monitored against historical activity to identify anomalous patterns within a client’s mobile activity vis-à-vis the overall domestic payment activity. The monthly report will be used to identify any material changes in the clients transactional behaviour based on a 12 month average.
Near Limit Transactions
Monthly report identifying pattern of transactions within 5% of limit.
Repeated transactions just below the mandatory limits imposed by the authorities. Such activity may be a means of maximizing value of total transactions while avoiding blocks and/or detection.

5. AML Monitoring - Customers
Typology / Risk
Limits / Controls
Analytics
Justification
Over Limit Transactions
Limits: Transactions in excess of mandated limits cannot be processed
Monthly report to monitor compliance with mandated limits.
Mandatory limits are imposed by the MNO, and transactions in excess of those limits cannot be processed. An additional analytics report will monitor for any failure to enforce the mandatory limits.
Multiple Transactions
Monthly report identifying top users of mobile transactions to/from 3rd parties (e.g. payments to/from remitters).
Will flag multiple transactions which can be used to hide the greater sum ultimately being transferred. Focus will be placed on the third party recipients or remitters of mobile payments and the rationale for such payments.
Sanctions
Control: All transactions screened, in real time
Sanctions screening is conducted , in real time, on all counterparties in accordance with standard Citi screening procedures .

6. AML Monitoring - Agents
Typology / Risk
Mantas / Limits / Controls
Analytics
Justification
Intensive Processing of Cash-In / Cash-Out Transactions
Monthly report on top agents with the highest monthly accumulated deposits or withdrawals
Focus will be placed on those agents that are most active and the rationale for their activity.
Anomalous Trend of Continuous Transactions
Monthly report on Agents that process more than a certain number of cash-in or cash-out transactions in a single day where this behaviour is repeated multiple times in 30 days.
Will flag multiple transactions and this will be monitored against activity over a 30 day period. Focus will be placed on the rationale for these transactions.
High Risk Regions/ Geographies
Monthly report identifying patterns of transactions from agents in high-risk regions (border areas, etc)
Analysis around patterns of transactions carried out by agents will flag any anomalies including material changes in behaviour.
Foreign Activity / Cross-Border Payments
Controls: Transactions are not available for cross-border use at this time, and transactions are currently possible only in local currencies.
Cross-border transactions may present higher risk. Such transactions, however, are not permitted at this time and are operationally not possible. In addition Agents do not have a presence outside of the country.