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Money Laundering

Money Laundering. Felicity Banks Head of Business Law, ICAEW. 2007 Regulations – What has changed?. 2007 Regulations – What has changed :. Nothing Much. 2007 Regulations – What has changed :. Requirement to be supervised Risk based approach (risk assessment and implementation)

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Money Laundering

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  1. MoneyLaundering Felicity Banks Head of Business Law, ICAEW

  2. 2007 Regulations – What has changed?

  3. 2007 Regulations – What has changed : Nothing Much

  4. 2007 Regulations – What has changed : • Requirement to be supervised • Risk based approach (risk assessment and implementation) • Tightening of due diligence (PEPs, beneficial owners …) • Removal of gold plating (changes in wording of Regulations)

  5. Systems Requirements • Customer due diligence – ID for new clients • Record keeping • Reporting procedures • Communication and training • Establish and maintain systems appropriate to forestall and prevent money laundering ….

  6. Systems Requirements • Customer due diligence – ID for ALL clients • Customer due diligence – Continual monitoring • Risk Approach – Risk profile for firm - Risk based CDD • Monitoring and management of compliance

  7. What to Report? • Any crime which has resulted in proceeds (even if small)

  8. What to Report? • Any crime which has resulted in proceeds (even if small) • Not attempted fraud or theft that did not come off • Not tax evasion, until after the tax should have been paid and was not

  9. What to Report? • Any crime which has resulted in proceeds (even if small) • Not unlawful but non-criminal behaviour even if redress could be due • Not parking fines (unless it is a criminal offence in Guernsey not to pay them)

  10. What to Report? • Proceeds of any crime which the suspect knows or suspects has happened If a client does not know that he has stepped the wrong side of the law, there is no possibility of money laundering (until you tell him)

  11. Risk based CDD “On the basis of documents, data or information obtained from a reliable independent source” • Specific provisions on some points • Otherwise, based on the firms’ own risk assessment

  12. Risk based CDD • Politically Exposed Persons • Client not present • Beneficial ownership ------------------ • “Normal Risk” clients • Existing clients • Reliance on others

  13. GUIDANCE AML Guidance for the Accountancy Sector • Prepared and Issued by CCAB • Addressed to accountants, auditors, tax advisers, insolvency practitioners, trust and company service providers in the UK • Available from www.ccab.org.uk

  14. GUIDANCE AML Guidance for the Accountancy Sector • CIoT and other supervisory bodies also apply this Guidance in the UK. • Channel Isles authorities also welcome to use it.

  15. OTHER CHANGES • Privilege reporting exemption • Electronic ID • The Confidentiality of SARs • More Representations • Etc. etc.

  16. OTHER UK GUIDANCE • CIoT - www.tax.org.uk/ • JMLSG - www.jmlsg.org • SOCA – www.soca.gov.uk • ICAEW - www.icaew.com/moneylaundering

  17. What is it all about?

  18. What is it all about? • The process by which criminals retain, disguise and conceal the proceeds of their crimes • The process by which funds are raised, consolidated and retained for use in financing terrorism

  19. What is it all about? IFAC - Introduction and Fundamental Principles • 100.1 A distinguishing mark of the accountancy profession is its acceptance of the responsibility to act in the public interest.

  20. What is it all about? • Professional accountants provide relevant information to those entitled to it, enabling them to perform their legitimate functions

  21. What is it all about? • Professional accountants provide relevant information to those entitled to it, enabling them to perform their legitimate functions • All society benefits when fair laws are enforced fairly. • Accountants should assist law enforcement by reporting money laundering

  22. What is it all about? • To report effectively and professionally, you need to: • have systems to ensure the whole firm knows what they are doing, and do it • know who your clients are, and roughly what they are doing

  23. AML – What is it for:

  24. AML – What is it for: • Not just organised crime and terrorism – also the proceeds of crime more generally, including tax evasion

  25. AML – What is it for: • Not just organised crime and terrorism – also the proceeds of crime more generally, including tax evasion • But Al Capone was jailed for tax evasion – don’t underestimate the value of your money laundering suspicion reports

  26. MoneyLaundering Felicity Banks Head of Business Law, ICAEW

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