Regulatory inspections are an integral part of the supervisory process that ensures investment firms, crypto-asset service providers, and other regulated entities remain compliant with their obligations under CySEC and EU legislation. In 2025, CySEC continues to emphasize a proactive, risk-based approach to supervision, meaning firms must be ready for an inspection at any time.
The importance of Inspection Readiness
In 2025, inspections have evolved beyond simple document reviews. They now assess how a firm’s policies are applied in practice, whether senior management demonstrates accountability, and whether compliance and risk functions are truly independent and empowered.
Regulatory inspections may include:
- Desk-based (off-site) reviews, focusing on submitted reports and compliance documentation.
- On-site visits, where CySEC examiners engage with management, compliance officers, and staff to evaluate systems, processes, and record-keeping.
- Thematic inspections, targeting specific areas such as AML/CFT, governance, complaints handling, or conflicts of interest.
Being unprepared for a regulatory inspection can result in findings that lead to administrative sanctions, remediation orders, or even license suspension. Therefore, preparation is not just a compliance requirement; it is an operational necessity.
The CySEC Inspection Framework
CySEC’s supervisory framework is built upon a risk-based model, prioritizing firms according to their size, complexity, and risk exposure. Each inspection aims to ensure that regulated entities comply with their legal and regulatory obligations while maintaining sound governance structures.
1. Governance and Organisational Structure:
- Assessment of the roles and responsibilities of the Board of Directors, senior management, and key function holders.
- Evaluation of segregation of duties, accountability, and oversight mechanisms.
2. Compliance FunctionReview of internal compliance monitoring programs, policy implementation and reporting procedures
Verification that compliance officers are independent, well-resourced, and knowledgeable.
3. Risk Management and Internal AuditExamination of the firm's risk framework, internal audit findings, and follow-up procedures.
4. AML/CFT Systems and ControlsEvaluation of customer due diligence, ongoing monitoring, sanctions screening, and suspicious activity reporting.
5. Outsourcing and Third-Party Arrangements
Review of due diligence, contracts and supervision of outsourced services.
6. Complaints Handling and Record-Keeping
Assessment of procedures for complaint management, documentation, and timely resolution.
7. Product Governance and Suitability- Verification that product design and distribution align with clients' needs and regulatory requirements.
What is the How to Get Prepared for an Inspection by the Regulator in 2025 course and what does it include?The
Annual AMLCO Report course, is developed by
SALVUS Funds and led by their Risk & Compliance Director,
Evdokia Pitsillidou. It is designed for professionals working in regulated firms, including investment firms (CIFs), crypto-asset service providers (CASPs), fund managers, and compliance teams, who wish to gain practical insight into the CySEC inspection process.
By undertaking this course, participants will:
- Understand CySEC’s inspection methodology and objectives.
- Learn how to prepare documentation and internal reports before an inspection. Gain insight into interaction techniques during on-site interviews.
- Recognize the importance of post-inspection follow-up and remediation.
- Strengthen their organization’s culture of compliance and accountability.
The syllabus of the How to Get Prepared for an Inspection by the Regulator in 2025 course includes:
- Introduction to CySEC Supervisory Framework
- Types of Regulatory Inspections
-Desk-based, on-site, and thematic reviews
- Inspection Preparation and Readiness Checklists
- Governance and the Role of the Board
- Responsibilities of the Compliance Officer
- Inspection Focus Areas: AML/CFT, Risk, Internal Audit, Outsourcing, Complaints, Product Governance
- Common Findings and Regulatory Observations
- Post-Inspection Actions and Corrective Measures
- Communication with the Regulator
The course is delivered through online video sessions and PDF materials, enabling flexible, self-paced learning. Participants can access the content at any time and from anywhere, making it ideal for busy compliance and management professionals.
Upon completion, learners can test their understanding through knowledge-based questions and earn 5 Continuous Professional Development (CPD) hours, recognized by CySEC for both Basic and Advanced certifications.
Why inspection Readiness Matters in 2025
Preparing for a regulatory inspection is not a one-time task; it is an ongoing process that reflects an organization’s commitment to governance, transparency, and compliance excellence. Firms that consistently maintain documentation, conduct internal reviews, and invest in staff training are not only inspection-ready but also more resilient and trustworthy in the eyes of regulators and clients.
By completing this course, professionals will gain the confidence and tools to handle inspections efficiently, reduce compliance risk, and strengthen their firm’s overall regulatory posture.
