Archive for February, 2009
25/02/09 India poised to have FATF entry approved
Posted by: BTC in International News on February 25th, 2009
New Delhi: A Bill aimed at effectively combating money-laundering, terror financing and cross-border economic offences was passed by Parliament on Tuesday, with the Lok Sabha approving the measure.
The Prevention of Money Laundering (Amendment) Bill, 2009, passed by the Rajya Sabha last week, seeks to ensure a legal framework to check such crimes. Winding up a discussion on the Bill in the Lok Sabha, minister of state for finance PK Bansal assured the House that the government would not be found wanting in taking action against those indulging in money-laundering. The new law seeks to check use of black money for financing terror activities.
Financial intermediaries like full-fledged money changer, money transfer service providers such as Western Union and International Payment gateways, including VISA and MasterCard have also been brought under the ambit of The Prevention of Money-Laundering Act.
Consequently, these intermediaries, as also casinos, will be brought under the reporting regime of the enforcement authorities. It would also check the misuse of promissory notes by FIIs, who would now be required to furnish all details of their source.
Bansal said the Act would check misuse of “proceeds of crime” be it from sale of banned narcotic substances or breach of the Unlawful Activities (Prevention) Act.
The passage of the Prevention of Money Laundering (Amendment) Bill, 2009 will enable India’s entry into Financial Action Task Force (FATF), an inter-governmental body that has the mandate to combat money laundering and terrorist financing.
The Bill, after becoming an Act, will address India’s international obligation and empower the enforcement directorate to search the premises immediately after the offences are committed and police have filed a report.
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25/02/09 Garda fraud officers continue Anglo probe
Posted by: BTC in General News & Cases, International News on February 25th, 2009
THE Garda Fraud Squad raid on the offices of Anglo Irish Bank was unprecedented and could lead to criminal prosecutions, according to legal experts.
On Monday, a judge in Dublin’s District Court granted officers from the Garda Fraud Squad permission to enter three separate premises of Anglo Irish Bank and take possession of any books or documents, including permission to preserve and prevent interference with any material information seized by up to 20 officers working with Ireland’s corporate enforcer.
It was the first time that the Office of the Director of Corporate Enforcement (ODCE) has ever sought permission from the courts to search the premises of a financial institution under investigation for possible breaches of company law.
The rarely used section 20 of the Companies Act 1990 has previously only been brought to bear against individuals.
Last night, the ODCE refused to disclose the reasons for its application to the District Court, citing “operational reasons”.
The warrant is valid for a month but gardai can retain any documents seized for an unlimited period of time, following changes in the law in 2005.
Breaches
Legal experts have said that a series of possible prosecutions could result from the ODCE investigation including charges relating to the failure to keep proper books of account and breaches of rules relating to directors’ loans. The ODCE can also investigate possible offences where an individual who is financially interested in the success or failure — or the apparent success or failure — of the bank, sought to influence the bank’s policy.
The investigation of ownership of shares or debentures, including their acquisition, disposal or transfer, may also constitute grounds for seeking a warrant.
The new acting chief executive of the Financial Regulator, Mary O’Dea, has been working closely with the ODCE and exchanging information on matters relating to Anglo Irish Bank.
This includes an investigation into all loans and other benefits provided by the nationalised bank to its directors and the unwinding of a major Contracts for Difference (CFD) position held by businessman Sean Quinn.
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25/02/2009 FATF Statment
Posted by: BTC in AML Legislation updates on February 25th, 2009
IRAN
The FATF welcomes Iran’s initial engagement with the international community on money laundering. However, the FATF remains concerned by Iran’s failure to meaningfully address the ongoing and substantial deficiencies in its anti-money laundering and combating the financing of
terrorism (AML/CFT) regime. The FATF remains particularly concerned about Iran’s failure to address the risk of terrorist financing and the serious threat this poses to the integrity of the international financial system. The FATF urges Iran to immediately and meaningfully address its AML/CFT deficiencies, in particular by criminalising terrorist financing and ffectively
implementing suspicious transaction reporting (STR) requirements.
The FATF reaffirms its call on members and urges all jurisdictions to advise their financial institutions to give special attention to business relationships and transactions with Iran, including Iranian companies and financial institutions. In addition to enhanced scrutiny, the FATF further calls on its members and urges all jurisdictions to apply effective counter-measures to
protect their financial sectors from money laundering and financing of terrorism (ML/FT) risks emanating from Iran. Jurisdictions should also protect against correspondent relationships being used to bypass or evade counter-measures and risk mitigation practices, and take into account ML/FT risks when considering requests by Iranian financial institutions to open branches and subsidiaries in their jurisdiction.
The FATF remains prepared to engage directly in assisting Iran to address its AML/CFT deficiencies, including through the FATF Secretariat.
UZBEKISTAN
The FATF welcomes the process undertaken by Uzbekistan to adopt comprehensive AML/CFT measures within a specific timeframe. Nevertheless, given that concrete measures to address the identified deficiencies have not yet been implemented, the FATF reiterates its statement of 16 October 2008, calling on its members and urging all jurisdictions to strengthen preventive measures to protect their financial sectors from the ML/FT risk emanating from Uzbekistan.
TURKMENISTAN
Despite a prolonged dialogue with the FATF and other international institutions, Turkmenistan has not yet made progress in adopting AML legislation. Financial institutions should remain aware that the lack of an AML/CFT regime in Turkmenistan constitutes an ML/FT vulnerability in
the international financial system and should take appropriate measures to address this risk. Turkmenistan is urged to adopt without further delay a comprehensive AML/CFT regime that meets international AML/CFT standards. Turkmenistan is encouraged to continue to work closely with the Eurasian Group and the International Monetary Fund to achieve this.
PAKISTAN
The FATF reaffirms its public statement of 28 February 2008 regarding the ML/FT risks posed by Pakistan. The FATF welcomes the process underway in Pakistan to improve its AML/CFT regime.
The FATF encourages Pakistan to continue to fully co-operate with the World Bank and the Asia Pacific Group on Money Laundering (APG) on its mutual evaluation process
SÃO TOMÉ AND PRÍNCIPE
The FATF welcomes São Tomé and Príncipe’s recent steps toward addressing identified AML deficiencies, in particular, through the adoption of an AML law in November 2008. The FATF urges São Tomé and Príncipe to address the remaining AML/CFT deficiencies, particularly relating to terrorist financing.
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19/02/09 Increase in the Money Laundering annual registration fee
Posted by: BTC in General Information & FAQ's, HMRC News and Guidance on February 19th, 2009
HMRC today announce an increase of the annual registration fee for businesses registered under the Money Laundering Regulations 2007 to £120. The sectors affected are Money Service Businesses, High Value Dealers, Trust or Company Service Providers and Accountancy Service Providers.
The Money Laundering Regulations supervisory regime is run on a full cost recovery basis and the fees you pay cover the expense of running the operation. HMRC costs include registering new businesses, contacting and visiting businesses, running an effective risk system, maintaining the register and producing guidance and information for customers.
Introduced in 2002, the fee was initially set at £100, and was subsequently reduced to £60 from June 2003. There were no changes until 1 June 2007, when the fee was increased to £95; this level was maintained in 2008.
HMRC state that it is now necessary to increase the fee further in order to provide them with sufficient income to cover their costs over the next year. The cost of registration from 1 June 2009 will be £120 per premises.
If you are a registered Money Service Business, High Value Dealer, Trust or Company Service Provider or Accountancy Service Provider, you do not need to do anything now. Your next fee renewal notice (MLR 113) will be sent to you as normal and will be based on the new fee level.
Visit the BTC website for compliance help and support for firms in the regulated sector.
12/02/2009 14,000 tax avoidance schemes and counting…
Posted by: BTC in General News & Cases, HMRC News and Guidance on February 12th, 2009
At the last count, since rules requiring the disclosure of tax avoidance arrangements to HMRC were introduced in 2004 there had been around 14,000 such schemes.
Or so we thought. Now it seems these might be far from the limit of the problem, as many “promoters” of schemes, such as accountants, lawyers and specialist “boutique” tax avoidance firms, are refusing to play the game.
A parliamentary answer obtained by Austin Mitchell MP, who has also tabled an early-day motion urging action on tax avoidance, reveals that no fewer than 90 promoters are under investigation for failing to disclose schemes. Presumably they were either hoping they wouldn’t be picked up or think they have found a loophole in the rules.
As promoters tend not to limit themselves to the odd scheme or two, the number of undeclared wheezes could be significant, especially if some of the bigger promoters think they have successfully found ways around disclosure. And that’s without considering any that are still beavering away unnoticed.
Ninety promoters not disclosing schemes is alarming, even with the reassurance that HMRC is onto them. At the very least it shows that, valuable as disclosure rules are, they are no guarantee of authorities getting on top of tax avoidance.
Visit the BTC website for compliance help and support for firms in the regulated sector.
04/02/09 Birmingham Anti-Money Laundering Conference
Posted by: BTC in General News & Cases, SOCA - Latest News on February 4th, 2009
Businesses in the Birmingham area are invited to a FREE one day conference to learn how to safeguard themselves against serious organised crime and money laundering.
The event, run by ‘Payback’ and hosted by the UK Financial Intelligence Unit of SOCA, will be held on Thursday March 12 at the National Motorcycle Museum, Birmingham and is aimed at small and medium sized businesses that are covered by the Money Laundering Regulations.
Such businesses – by their very nature – are vulnerable to abuse by those attempting to launder the proceeds of crime, and the aim of the conference is to make businesses more aware of their role in identifying any suspicious activity taking place during their day-to-day work, thereby making a difference in reducing harm caused to communities by serious organised crime and also protecting their business.
The programme of event is specifically designed to reflect the needs of those within an organisation that have a working interest in combating money laundering, to ensure their business is compliant, to share ideas and help mitigate against the possibility of criminals using businesses to launder the proceeds of crime.
The day will run from 9.30am ton 4.30pm and anyone interested should contact fiudialogue@soca.x.gsi.gov.uk for an application form. It is a first come, first served basis.
Visit the BTC website for compliance help and support for firms in the regulated sector.
03/02/09 Important information for Money Service Businesses (MSBs)
Posted by: BTC in AML Legislation updates, HMRC News and Guidance on February 3rd, 2009
This note is to alert all Money Service Businesses (MSBs) to HM Treasury’s new powers to issue directions under the Counter Terrorism Act which came into force on 26 November 2008.
What powers does HM Treasury have?
HM Treasury (HMT) may give a direction if one or more of the following apply:
• The Financial Action Task Force has advised that measures should be taken in relation to the country because of the risk of terrorist financing or money laundering activities
• HMT reasonably believe that there is a risk of terrorist financing or money laundering activities and that this poses a significant risk to the national interests of the UK
• HMT reasonably believe that a country is involved in developing nuclear, radiological, biological or chemical weapons and that this poses a significant risk to the national interests of the UK
What does this mean for MSBs?
HMT could issue directions to all MSBs, or to some types of MSBs or to a particular business. This means that you must be ready to deal with these directions by training your staff and including how to deal with them in your anti money laundering systems.
How will I know a direction has been issued?
MSBs should sign up to Treasury’s email alert system at HM Treasury AML/CTF mailing list
What will I have to do?
Specific guidance will be issued with each direction and you will need to read the conditions imposed very carefully to find out what you need to do.
You will have to identify the customers or transactions that are affected and may need to carry out more detailed checks on them.
You may need to do one or more of the following:
• Carry out enhanced customer due diligence (see MLR 8 para. 7.12 (PDF 653K)). You would normally do this in high risk situations such as when the customer is a politically exposed person.
• Carry out ongoing monitoring of customers in a business relationship (see MLR 8 Part 9 (PDF 653K)). This is the kind of monitoring you would normally do in high risk situations.
• Report all transaction with these people and organisations. You may need to do this weekly.
• Cease business with certain people and organisations.
What if I have to cease business with certain people and organisations?
If this happens your customer or you can apply for a license to exempt them from this. HMT will provide further information on how to apply for licenses when they issue a direction.
Visit the BTC website for compliance help and support for firms in the regulated sector.
