How to Write an AML Remediation Action Plan That Closes Findings
Pathik Shah
A practitioner guide for compliance officers and MLROs on writing credible and effective remediation action plans, covering structure, timeline calibration, root cause addressing, completion evidence, and governance of delivery. Written by Pathik Shah for AML Guild.
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- What is a remediation action plan?
- The structure of each remediation action
- Finding reference and description
- Proposed action
- Owner and timeline
- Completion evidence
- Addressing the root cause, not just the finding
- A remediation action plan template
- Calibrating the timelines
- The governance process
What Is a Remediation Action Plan?
A remediation action plan is a documented plan that explains how a regulated business will fix AML/CFT control weaknesses identified during a regulatory examination, audit, health check or supervisory review. It should identify the finding, the corrective action, the owner, the deadline, the evidence of completion and the governance process for monitoring delivery.
The Structure of Each Remediation Action
Each action in the remediation plan should follow a standard structure that allows the regulator to assess it against the four key questions: a genuine address of the finding, a realistic timeline, a named owner, and a clear completion criterion.
Finding Reference and Description
Each action should begin with a clear reference to the finding it addresses, using the finding number or title from the examination report. This ensures the regulator can map each action back to the relevant finding without having to cross-reference separately. The description should briefly restate the finding in neutral, factual terms.
Proposed Action
The proposed action should be described with sufficient specificity for the regulator to assess whether it genuinely addresses the finding. An action described as "reviewing the transaction monitoring framework" is not sufficiently specific. An action described as conducting a documented review of all transaction monitoring rules against the current business risk assessment, identifying rules that require recalibration, implementing the identified recalibrations, and documenting the review and recalibration process in a format that can be presented to the regulator is sufficiently specific to assess.
When I draft a remediation action, I test every line against a simple question: could an examiner read this and know exactly what we will produce and how they will recognise it is done. Vague verbs like enhancing or reviewing invite follow-up questions. Specific actions with defined completion evidence close findings the first time.
Jyoti Maheshwari | CAMS, ACA, AML/CFT Practitioner, AML Guild
Owner and Timeline
Each action should have a single named owner who is accountable for delivery. The owner should be named by role title rather than by personal name where possible, to ensure continuity of accountability in the event of personnel changes. The timeline should specify the completion date and any material interim milestones. For actions with a completion date more than three months from the plan submission date, at least one interim milestone should be specified.
Completion Evidence
The completion evidence specification describes what the institution will be able to show the regulator to demonstrate that the action has been completed. The completion evidence should be specific: the document that will exist, the data that will demonstrate the change, and the sign-off that will confirm delivery. A completion criterion for the action of merely "completed" is not a completion criterion.
Addressing the Root Cause, Not Just the Finding
A remediation action should not only correct the visible issue identified by the regulator. It should address the underlying cause of the issue. For example, if a sample file did not contain adequate source of funds evidence, the action should not be limited to updating that one file. The institution should ask why the gap occurred. Was the policy unclear? Was the KYC checklist incomplete? Was the relationship manager not trained? Was there no quality assurance review? Was the system allowing files to move forward without mandatory evidence?
A credible remediation plan should therefore include both a corrective action and a preventive action. The corrective action fixes the specific deficiency. The preventive action reduces the likelihood that the same issue will recur. This is often the difference between a plan that looks administrative and a plan that satisfies the regulator.
A Remediation Action Plan Template
The fields below pull the components above into a single working format. Each finding becomes one row, with both a corrective and a preventive action, a named owner, a calibrated deadline, a delivery status, and the evidence that will close it. The worked example below shows a single finding (F-03) laid out field by field.
| Field | Worked Example — Finding F-03 |
|---|---|
| Finding reference | F-03: Source of funds evidence missing in 4 of 20 sampled files |
| Corrective action | Update the 4 files with documented source of funds evidence; second-line review of each. |
| Preventive action | Make SOF evidence mandatory in the KYC checklist; block onboarding without it; train relationship managers. |
| Owner (role) | MLRO / Head of Onboarding |
| Deadline / milestone | Corrective 30 days; preventive 90 days (system-config milestone day 45) |
| Status | In progress |
| Completion evidence | Updated files with sign-off; revised checklist; system configuration screenshot; training attendance log |
Calibrating the Timelines
The timeline calibration process should begin with an honest work scoping exercise for each action: what specific work steps are required, how long each step realistically takes, what dependencies exist between steps, and what resources will be allocated to the work. The completion date should be derived from this scoping exercise, not set arbitrarily.
The compliance officer should resist the pressure, which often comes from commercial management rather than from the regulator, to set aggressive timelines that demonstrate urgency but that are unrealistic. The regulator who has accepted, acknowledged or not objected to a remediation plan and then receives a request for an extension is in a position to grant or refuse the extension. Still, the extension request may become part of the supervisory record and may be viewed as evidence of a delivery issue, particularly where the delay is poorly explained or repeated. A realistic timeline that is met is worth far more than an ambitious timeline that is not.
The timelines I worry about are the ones set to look impressive rather than to be met. A missed committed date may become part of the supervisory record and may be viewed as evidence of a delivery weakness, particularly where the delay is unexplained or repeated. I would always rather commit to a realistic date, scope the work properly, and then actually hit it.
Dipali Vora | CAMS, ACA, AML/CFT Practitioner, AML Guild
The Governance Process
The governance of the remediation plan should be formalised through a defined tracking and reporting process. This process should include: a weekly or fortnightly internal progress review for each open action, attended by the action owner and the MLRO; a monthly or quarterly progress report to the board or audit committee, presenting the current status of all open actions and any risks to delivery; a process for escalating delivery risks to the MLRO and to the board where they cannot be resolved within the team; and a formal regulator update process that provides the committed progress reports at the committed frequency.
Each open action should also carry a clear delivery status, drawn from a consistent set of categories such as Not started, In progress, Delayed, Completed pending validation, and Closed. Critical findings and any overdue actions should be given specific visibility to senior management and, where appropriate, the board, so that delivery risk is owned at the right level rather than remaining within the compliance team.
Frequently Asked Questions
Everything you need to know about AML remediation action plans and how AML Guild supports your business.
Yes. Circumstances change, and remediation plans sometimes need to be amended. The appropriate approach is to proactively notify the regulator when a material change to the plan is anticipated, rather than submitting a progress report reflecting the change without prior notification. The regulator who is proactively informed that a timeline requires an extension, with a credible explanation and a revised timeline, is in a position to engage constructively. The one who discovers that timelines have been missed in a progress report that was submitted without prior notification is in a less constructive position.
The regulatory response to missed remediation commitments depends on the severity of the underlying finding, the reason for the delay, and the history of the supervisory relationship. In most frameworks, a single missed commitment with a credible explanation and a revised, realistic timeline is unlikely to produce formal enforcement action in isolation. A pattern of missed commitments, or a missed commitment relating to a critical finding, may increase the risk of supervisory escalation, the requirement to engage external consultants, or, in the most serious cases, formal enforcement action. The institution should treat every committed date as a date it must meet.
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