Presentation to National Supervisors Forum 2010 AGM 7th November 2010 Money Laundering

1. Presentation to National Supervisors Forum � 2010 AGM 7th November 2010 Money Laundering/Terrorist Financing � Garda Perspective Detective Sergeant Clodagh White GARDA BUREAU OF FRAUD INVESTIGATION

2. Presentation Topics FIU/MLIU Structures Level of STRs Investigation of STRs Money Laundering Trends/Emerging Risks Role of Supervisory Committee Members vis-�-vis AML/CTF Value of STRs? Criminal Justice (Money Laundering & Terrorist Financing) Act, 2010 � New Act & main provisions Production Orders Terrorist Financing Good Evening _ firstly I would like to thank the Irish League of Credit Unions for giving us the opportunity to speak to you today. We will start with a quick run through of the topics we hope to cover tonight. New Legislation will present challenges to us all and we will cover the changes from the perspective of Garda/ Credit Union Perspective. Good Evening _ firstly I would like to thank the Irish League of Credit Unions for giving us the opportunity to speak to you today. We will start with a quick run through of the topics we hope to cover tonight. New Legislation will present challenges to us all and we will cover the changes from the perspective of Garda/ Credit Union Perspective.

3. FIU/MLIU Structures Financial Intelligence Unit (FIU) - Part of the Garda Bureau of Fraud Investigation - 7 Garda personnel & 4 Clerical assistants Money Laundering Investigation Unit (MLIU) - 2 Investigation Teams - 7 Garda personnel 2 Detective Sergeants trained in each Garda Division Co-operation with CAB and other National Support Services Units Work closely with other FIUs worldwide, external Police Forces and Law Enforcement Agencies

4. Level of STRs As you can see the level of reporting has increased incrementally year on year and there is no expectation that this will change as we move forward. 2001 -2002 increase after 9/11 1/5/03 � introduction of Dual Reporting 2005 - Terrorist Financing � Updating Systems at Financial Institutions 2008 � Each update became an individual STRAs you can see the level of reporting has increased incrementally year on year and there is no expectation that this will change as we move forward. 2001 -2002 increase after 9/11 1/5/03 � introduction of Dual Reporting 2005 - Terrorist Financing � Updating Systems at Financial Institutions 2008 � Each update became an individual STR

5. Investigation of STRs Has subject come to Garda/Police notice before � any criminality? Three way link: subject, funds and Predicate offence (criminal conduct) Check all law enforcement databases & international enqs. if necessary �Hit� � Records uplifted by Section 63/14A Orders No approach to subject/suspect unless evidence of predicate offence established Arrest/Detention then considered DPP ultimate authority �No Hit� � Case closed � good financial intelligence � feedback given to designated person Regular meetings with Revenue Commissioners When you submit an STR � What happens? At all times the confidential relationship between the submitting institution and AGS/Revenue is given paramount importance!When you submit an STR � What happens? At all times the confidential relationship between the submitting institution and AGS/Revenue is given paramount importance!

6. Money Laundering Trends/Emerging Risks MAIN SOURCE OF FUNDS: DRUG TRAFFICKING, CASH IN TRANSIT ROBBERIES, TAX EVASION & CROSS BORDER SMUGGLING . . . GENERALLY CASH-BASED FUNDS PURCHASE OF PROPERTY � MORTGAGES/LOANS > Borrow �Clean�, Repay �Dirty� PURCHASE OF HIGH-VALUE GOODS ELECTRONIC FUND TRANSFERS, e.g. Western Union, etc. USE OF CORPORATE STRUCTURES � Two types of scenarios USE OF LARGER NOTES (�500 NOTES) LOADING CREDIT CARDS/ATM ACCOUNTS USE OF �MONEY MULES� As the ability to use the benefits of criminal conduct is the driving force behind Money Laundering the methods used to Launder these proceeds are constantly evolving �. These are the most prevelent. Corporate Structures - Legitimate Business taken over when in trouble _ LBS � Setting up of cash based business to conceal origins of funds Does your Credit Union issue ATM Cards � Does it conduct a Western Union Business � May be reported by Money transmitter As the ability to use the benefits of criminal conduct is the driving force behind Money Laundering the methods used to Launder these proceeds are constantly evolving �. These are the most prevelent. Corporate Structures - Legitimate Business taken over when in trouble _ LBS � Setting up of cash based business to conceal origins of funds Does your Credit Union issue ATM Cards � Does it conduct a Western Union Business � May be reported by Money transmitter

7. Role of Supervisory Committee Members vis-�-vis AML/CTF You supervise the financial operations of your respective credit unions by �ensuring that all laws, regulations, policies and procedures are strictly adhered to . . .�: > Sec. 54 (2010 Act): �policies & procedures� must be adopted and followed > C.U. employees must be instructed on AML/CTF legislation & receive �ongoing training� > Employees need to keep the proper transaction records & be able to identify �suspicious transactions� > . . . Know your customer � key to AML/CTF . . . > Mindful of �tipping-off� It is essential to include as much detail as possible �. The grounds for the suspicion should be clearly set out �. The amount alone is not enough Remember disclosures are confidential It is essential to include as much detail as possible �. The grounds for the suspicion should be clearly set out �. The amount alone is not enough Remember disclosures are confidential

8. Role of Supervisory Committee Members vis-�-vis AML/CTF Cont�d . . . Receipt of good quality STRs is vital in the fight against ML/TF - How can you ensure that �frontline� employees make quality internal reports??? Credit Union STRs should contain: Personal details of customer � name, current/previous addresses, date of birth, occupation, nationality Joint accounts � require date of birth of both account holders and identification details for both Details of I.D. produced � passport nos. & country of issue, d/licence nos., etc. (provide copies of I.D. if desired � very useful) . . . . Retain good quality copy of identification produced . . . . It is essential to include as much detail as possible �. The grounds for the suspicion should be clearly set out �. The amount alone is not enough Remember disclosures are confidential It is essential to include as much detail as possible �. The grounds for the suspicion should be clearly set out �. The amount alone is not enough Remember disclosures are confidential

9. Role of Supervisory Committee Members vis-�-vis AML/CTF Cont�d . . .