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The objective of this non-binding guidance paper is to describe the features of an effective supervisory system, with an aim to enhance countries’ understanding of the relevant FATF requirements by describing good practices and providing illustrative case examples. The practices described in this document are intended to serve as examples of the measures and means that relevant supervisors in countries may use to meet the requirement of the FATF Recommendations regarding a supervisory approach. Finally, this Guidance is intended to address AML/CFT supervision and enforcement of preventive measures for financial institutions as defined by the FATF and should be read in conjunction with the relevant FATF Guidance Papers on the Risk Based Approach (RBA), such as the RBA Guidance for the Banking Sector (2014) and Sound Management of Risks Related to Money Laundering and Financing of Terrorism (Basel Committee, 2014).