The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) is the 4th Directive issued by the EU and it replaces the Money Laundering Regulations 2007 (MLR 2007) and the Transfer of Funds (Information on the Payer) Regulations 2007.
Most found maneuvering through the previous legislation somewhat challenging and dense in some areas, yet lean and full of gaps in other parts. The new MLR 2017 does not re-write the previous regulation but rather extends and builds on the legislation.
Relevant persons ow extends to include all gambling provides and not just holders of casino license and the MLR 2017 now places greater obligations on Trustees.
So what does the new MLR 2017 do? …….Key Changes:
- Does not apply to those engaging in financial activity on a very occasional basis (the turnover had increased from the 2007 regulations of £64,000 with the new turnover detailed as £100,000).
- Improving transparency of beneficial ownership of companies and trusts
- Prevents new means of terrorist financing, including e-money and prepaid cards
- Revised customer due diligence - adopt a more risk-based approach towards anti-money laundering. The MLR 2017 sets out a procedure analyze exposure to money laundering and terrorism.
- A relevant person must produce a written Anti Money Laundering (AML) risk assessment report addressing its customers, countries of operation, products and services, transactions, delivery channels and the size and nature of the business. The finding must then be used to produce policies.
- These policies must include internal controls over money laundering and terrorist financing risks. This will include revised customer due diligence procedures as well as reporting, record keeping and monitoring requirements.
- Relevant persons are still able to rely on the customer due diligence undertaken by a 3rd party, if that third party is subject to the MLR 2017. For example you can rely on due diligence undertaken by your solicitors or bank. However the 3rd party must provide the customer due diligence information and documentation it has obtained thought its own due diligence process and further enter into a written agreement under which it agrees to provide within two working days copies of all due diligence
- A new criminal offence has been create for any person who recklessly makes a statement in the context of money laundering which is false or misleading - you could find yourself in prison for up to 2 years do so!
So how do you comply with the MLR 2017, and ensure you don’t get fined or imprisoned?
- Familiarise yourself with the MLR 2017
- Revision of Anti Money Laundering written risk assessments
- Review of AML policies and procedures
- Review and update training for staff
Walker Rose Solicitors are experts in advising and supporting business and owners on their anti-money laundering obligations. We can either provide advice and guidance on how to undertake an effect risk assessment or we can undertake the risk assessment for you and draft the necessary polices and provide training to staff to ensure compliance with money laundering regulation.
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