Money Laundering Bulletin

Nearly there – the Fourth EU Directive final draft

Just shy of two years since the first Commission draft was published, the negotiated final text of the Fourth EU Money Laundering Directive (4MLD) emerged from the Council presidency on 12 January.

PEPs, Predicate Crimes, Tax Evasion, Accountants and Tax Advisers, Banks, Lawyers, Casinos, Financial Intelligence Units, Government and International Bodies, Legislation & Guidance, Europe

In practice – a legal opinion

Life as a regulatory lawyer is fast-paced and never dull, certainly not in a City firm. Arun Srivastava, who heads the Financial Services Group at Baker & McKenzie in London, forces a space between meetings to share his thoughts on financial crime compliance with MLB’s editor Timon Molloy.

Reporting, Law Enforcement, Bribery and Corruption, Banks, Lawyers, Money Service Businesses, Cases, Practice Findings, Supervisors, Europe

Risky enforcement

MLB Editor Timon Molloy considers the response of banks to recent enforcement activity and its wider impact on the AML agenda.

Cases, Practice Findings

Algorithms are way forward against trade-based money laundering, says report

Financial institutions will need to automate more of their transaction monitoring in trade finance in response to regulators’ growing interest in trade-based money laundering, say consultants PwC in a report published today [8 January].

Technology, Trade Finance, Banks, Practice Findings

UK government launches anti-corruption strategy

The British government has announced its long awaited anti-corruption strategy, issuing a paper detailing a comprehensive list of reforms, including significant anti-money laundering (AML) and anti-fraud components.

Money Laundering, Customer Due Diligence, Reporting, Tracing and Recovery, Law Enforcement, Bribery and Corruption, Financial Intelligence Units, Government and International Bodies, Europe
Risks and Controls

Legacy issues - Afghanistan

British forces have already left Afghanistan and the US plans withdrawal of all combat troops by the end of 2016. President Ashraf Ghani must now divide his time between working to preserve security against the threat of Taliban resurgence and delivering on promised structural reform: the heroin trade and endemic corruption will be fixtures on his agenda but he might not have expected that AML compliance in the shape of local banks’ response to a massive fraud dating back to 2010 would also be a priority. Paul Cochrane reports.

Terrorist Financing, Bribery and Corruption, Predicate Crimes, Government and International Bodies, Legislation & Guidance, Practice Findings, South Asia

EU agrees to central registers of beneficial owners

The ultimate beneficial owners of companies and trusts will be recorded in central registers maintained by EU member states after EU Council and Parliament representatives finalised the draft text of the Fourth EU Money Laundering Directive late on 16 December 2014.

Customer Due Diligence, Government and International Bodies, Legislation & Guidance, Europe, Corporate Vehicles
Money Laundering

The Spanish inquisition

Spain was the first Financial Action Task Force member to undergo mutual evaluation of its AML/CFT regime for effectiveness. Sue Grossey looks at how the pioneer scored.

Reporting, Insurance, Lawyers, Money Service Businesses, Financial Intelligence Units, Government and International Bodies, Legislation & Guidance, Practice Findings, Europe

EU Fourth Directive heralds central beneficial ownership registers

National authorities in the member countries of the European Union (EU) will be obliged to create central registers listing the ultimate owners of companies on their territory following a deal on the fourth EU anti-money laundering directive (4MLD) agreed on Tuesday (16 December) in Brussels.

Customer Due Diligence, Government and International Bodies, Legislation & Guidance, Europe

Specific risk: FinCEN & Justice Department join forces against ex-compliance officer

As US compliance professionals return to their desks for another year of policing internal conduct at their firms, they face a new risk themselves, say Reginald Brown and Jaclyn Moyer of WilmerHale, namely, individual liability that could result in millions of dollars in fines and the effective end of their careers.

Money Service Businesses, Cases, Financial Intelligence Units, Supervisors, North America

Take ‘em out – AML goes into attack

“I don’t buy a burglar alarm to tell me I’ve been robbed”: Darren Innes, CEO of C6 Intelligence Group, independent risk data intelligence specialists, is in indignant mood when MLB visits...

Money Laundering, Monitoring, Payments, Predicate Crimes, Banks
Terrorist Financing

Islamic State – a model of modern terrorist financing

The most sophisticated terrorist force yet seen, Islamic State has built a varied funding infrastructure that is set to take easily as long to disable as its military assets. Paul Cochrane, based in Beirut, goes in search of the IS backers.

Terrorist Financing, Middle East

UK SARs total grows 12% but not evenly

The UK Financial Intelligence Unit received 354,186 suspicious activity reports (SARs) in the year to September 2014, an 11.90% rise on the 316,527 filed in 2012/13.

Terrorist Financing, Reporting, Law Enforcement, Banks, Lawyers, Money Service Businesses, Trust and Company Service Providers, Estate Agents, Financial Intelligence Units, Europe
Legal / Regulatory

Blue horizons – a Caribbean outlook

The Caribbean floats midway between the major sources of illegal narcotics in Latin America and markets on the Eastern seaboard of the United States and beyond, in Europe and Africa. Serena Joseph-Harris of Sirius International, who has previously worked in an official capacity for the Caribbean Financial Action Task Force (CFATF), anatomises the current regional challenges and trends.

Practice Findings, Latin America and Caribbean

US law sets framework for future Russian sanctions

On 13 December 2014, the US Congress passed the Ukraine Freedom Support Act of 2014 (H.R. 5859) seeking to impose new sanctions against Russia and in support of Ukraine. On 18 December, President Obama signed the Act into law, while stating that at present the Administration does not intend to impose new sanctions pursuant to the Act. Scott Balber of Herbert Smith Freehills considers the scope of the new statute.

Sanctions, Legislation & Guidance, Europe, North America

EU extends Crimea and Sevastopol sanctions, issues guidance on Russian restrictions

On 18 December, the Council of the European Union announced that it would be imposing “substantial” additional sanctions on investment, services and trade with Crimea and Sevastopol to reinforce the EU’s policy of not recognising those territories. Susannah Cogman of Herbert Smith Freehills examines the new measures.

Sanctions, Government and International Bodies, Legislation & Guidance, Europe

US extends scrutiny of Standard Chartered sanctions compliance

Standard Chartered Bank will undergo monitoring of its sanctions compliance programme for an additional three years, to 10 December 2017, following extension of two-year deferred prosecution agreements with the US Department of Justice and the New York County District Attorney’s Office that expired today [10 December 2014].

Sanctions, Banks, Cases, Practice Findings, North America