Parliamentarians in Brussels are busily amending the draft Fourth EU Money Laundering Directive before May’s election purdah; the British will be happy, certainly, that the latest compromise proposals on beneficial ownership data further last June’s G8 transparency agenda espoused by PM David Cameron. While the lawmakers debate, major banks - notably, recently, BNP Paribas and Credit Suisse - continue to weigh the known and potential cost of non-compliance with existing legislation. Timon Molloy reports.
In the grip of vicious drug wars, Mexico has introduced wide-ranging money laundering controls that extend customer due diligence obligations to new industries and set cash transaction and exchange limits. Eduardo Wilson and Kitty So examine the reforms and the criminal response.
Findings on anti-money laundering practice in UK-regulated firms are “depressing”, Sharon Campbell, Head of Financial Crime & Intelligence, UK Financial Conduct Authority acknowledged yesterday [4 March].
Suspicious activity reports must be filed in confidence but the risk that this might not survive litigation is all too real, warns Jonathan Fisher QC.
FINRA, the US Financial Industry Regulatory Authority, has fined custodian bank Brown Brothers Harriman $8 million, and Harold Crawford, its former Global AML Compliance Officer, $25,000 for not putting in place and operating an effective anti-money laundering programme.
Annual worldwide expenditure on AML is set to pass $10bn in the next couple of years while compliance professionals continue to cite regulatory change, rather than challenges in combating financial crime, as their number one concern, reports KPMG’s 2014 Global AML survey.
Standard Bank, the UK subsidiary of SBG, South Africa’s largest banking group, has been fined £7,640,000 by the Financial Conduct Authority (FCA) for breaching the Money Laundering Regulations.
It may be the most profitable form of transnational crime - trafficking in endangered species cannot be ignored. David Carlisle examines the legislative controls and how criminals circumvent them
High and stable in value, durable, compact - diamonds hold a unique appeal, whether for the rich and famous, the young couple looking for an engagement ring or the criminal wanting to hide and move his funds. The stones may sparkle but the business has its flaws, according to Financial Action Task Force findings. Sue Grossey examines every facet of the AML/CFT standard setter’s report.
Risks and Controls
Publication last October (2013) of the Financial Action Task Force (FATF) report on hawala, and other similar service providers (HOSSPs) shone a bright light on the sometimes shadowy alternative remittance sector. Robert Stokes switches on his torch to investigate.
London is preeminent as an international hub for finance, ranking in the first league also for investment and wealth management; no wonder the corrupt want to avail themselves of its dynamism and services. Transparency International UK has strong views on how the UK should deter them, proactively seize their assets and, in so doing, reset the international pace towards business integrity as standard. Nick Maxwell of TI-UK and Antonio Suarez-Martinez of Edwards Wildman Palmer set out its clear plan of action.
Members of two European Parliament committees have backed the proposed Fourth European (EU) Money Laundering Directive, as long as a public register provision is included.
Criminals rely on secrecy, obfuscation and, ideally, tangled cross-border corporate relationships. Governments are finally addressing the barriers to beneficial owner identification but while the G8 and G20 have signed up, good intentions cost little and vested interests mean that straightforward customer due diligence on all corporates and trusts is still far off. Alan Osborn looks at next steps on the path to transparency.
Lebanon’s hard-won, always precarious reputation as a comparatively clean banking location in the Levant was dealt a severe blow with the Lebanese Canadian Bank case in 2011 but it has restored confidence overseas, notably in Washington, in time to confront the financial fallout of war in neighbouring Syria. Paul Cochrane reports from Beirut.
Inability to spot suspicious transactions, cash-based economies, porous borders and weak inter-state cooperation leave West Africa open to terrorist financiers, the Financial Action Task Force (FATF) warns in a typologies report published yesterday [12 November 2013].
Legal / Regulatory
Luxembourg-based bank Clearstream and the Bank of Moscow, in the Russian capital, have agreed to sizeable penalities for apparent violations of US sanctions against Iran.
China is perturbed, the European Union wary and the US cautiously positive: supporters of Bitcoin, the virtual currency whose supply is fixed by an algorithm but not backed by a central bank, are pushing hard for its acceptance by AML regulators and the industry, and, in the US at least, with some success, says Robert Stokes.
In a further, practical step towards the rehabilitation of Iran, on 20 January the Joint Plan of Action, agreed by the Islamic republic and the five permanent members of the UN Security Council and Germany, took effect, easing some existing sanctions. Susannah Cogman and Rod Fletcher of Herbert Smith Freehills consider the specific adjustments and how much difference they are likely to make.
The Royal Bank of Scotland (RBS) has agreed to pay penalties totalling $100m to the US Federal Reserve, the New York Department of Financial Services and the US Office of Foreign Assets Control (OFAC) to settle ‘apparent’ violations of US sanctions programmes against Iran, Burma, Sudan and Cuba.
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