Money Laundering
Felicity BanksHead of Business Law,
ICAEW
ICAEW
2007 Regulations – What has changed?
ICAEW
2007 Regulations – What has changed :
Nothing Much
ICAEW
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)
ICAEW
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 ….
ICAEW
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
ICAEW
What to Report?
• Any crime which has resulted in proceeds (even if small)
ICAEW
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
ICAEW
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)
ICAEW
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)
ICAEW
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
ICAEW
Risk based CDD
• Politically Exposed Persons• Client not present• Beneficial ownership
------------------• “Normal Risk” clients• Existing clients• Reliance on others
ICAEW
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
ICAEW
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.
ICAEW
OTHER CHANGES
• Privilege reporting exemption• Electronic ID• The Confidentiality of SARs• More Representations • Etc. etc.
ICAEW
OTHER UK GUIDANCE
• CIoT - www.tax.org.uk/
• JMLSG - www.jmlsg.org
• SOCA – www.soca.gov.uk
• ICAEW -www.icaew.com/moneylaundering
ICAEW
What is it all about?
ICAEW
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
ICAEW
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.
ICAEW
What is it all about?
• Professional accountants provide relevant information to those entitled to it, enabling them to perform their legitimate functions
ICAEW
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
ICAEW
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
ICAEW
AML – What is it for:
ICAEW
AML – What is it for:
• Not just organised crime and terrorism – also the proceeds of crime more generally, including tax evasion
ICAEW
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
Money Laundering
Felicity BanksHead of Business Law,
ICAEW