Emma RadmoreFATF has updated its recommendations in respect of: Recommendation 1 and its interpretative note, to broaden the existing requirement specifically to require relevant entities to identify and assess the risks of...
Category - Financial Crime Prevention
Treasury Committee launches new Economic Crime inquiry
The Treasury Committee has launched a new inquiry to look at what progress has been made in combatting economic crime, building on previous recent inquiries, It will focus on: AML systems and the sanctions regime...
Financial Services Bill starts Parliamentary passage
The Financial Services Bill was introduced into Parliament on 21 October. The key aims of the Bill are: to implement the remaining Basel 3 standards; to create a more proportionate investment firms’ prudential...
MLR Bank Account Portal not yet ready
FCA has confirmed that the Bank Account Portal, which is being set up under the MLRs to enable credit institutions and providers of safe custody services to respond to requests for information from a law enforcement...
FCA: new webpages on whistleblowing
The FCA has launched two new webpages on whistleblowing. The first webpage sets out the process for reporting concerns of wrongdoing to the FCA in confidence and provides guidance on: Making the decision to speak to the...
Lucy HadrillCommission publishes EU work programme 2021
The European Commission has announced its focus for 2021. As well as continuing to work on managing the effects of the pandemic, its priorities will include: a “Fit for 55” packages to reduce emissions by...
FSB issues final report on CIRR toolkit
The Financial Stability Board (FSB) has published its final report on a toolkit of effective practices for financial institutions’ cyber incident response and recovery (CIRR). The toolkit aims to assist financial...
HMRC publishes MLR risk assessment guidance
HMRC has published risk assessment information to help businesses carry out the money laundering and terrorist financing risk assessment required under the MLRs. There are separate documents for each of: money services...
FSB reports on global stablecoins
The Financial Stability Board (FSB) has published its finalised high-level recommendations for the regulation, supervision and oversight of “global stablecoin” (GSC) arrangements. The report says that GSC...
SFO looks to future challenges
Lisa Osofsky has spoken on future challenges in economic crime. She focused on: the success of the National Economic Crime Centre in its first 2 years of existence; the refreshed Economic Crime Plan; better engagement...
FCA speaks on market abuse in the time of COVID-19
Julia Hoggett has spoken on the importance of regulators maintaining focus on ensuring markets work well for consumers and are orderly and clean, whatever the challenges. She spoke about how FCA aims to place the...
OFSI publishes annual review
OFSI has published its annual review for the year to March 2020. The review highlights: OFSI’s work to prepare for the end of the transition period; its work on reported breaches and how it decides on the...
FCA opens 2 sandbox windows
FCA has opened two new application windows in its Sandbox – applications for Cohort 7 of the now established regulatory sandbox, and the pilot of a new Digital Sandbox. The emphasis is on firms providing products...
FGC updated for MLR changes
The Financial Crime Guide has been updated to reflect necessary changes consequent on implementation of MLD5. In particular, it now covers new high-risk factor considerations; changed e-money thresholds for CDD; updated...
OFSI publishes quarterly TAFA report
OFSI has published its quarterly report on the operation of TAFA, covering the quarter to end March 2020. At the end of the quarter, just over £100,000 were frozen, but mainly relating to the EU Al-Qaida Regulation...
EU updates on AML initiatives
Valdis Dombrovskis has spoken on financial crime prevention and, in particular on the AML action plan. He is pleased at the support the plan received, and the overwhelming agreement that no action is not an option. They...
FCA reports on regulatory perimeter
FCA has published its second report on the regulatory perimeter. The report looks at: consumer confusion about the perimeter – and when FCA has the power to act. It also notes that customers may be confused as to...
EU proposes crypto-asset market Regulation
The EU has published a proposal for a Regulation on markets in crypto-assets, as part of its Digital Finance package. The proposal notes many Member States have legislated on issues relating to crypto-assets which has...
Treasury Committee seeks economic crime answers
The Treasury Committee has written to BEIS, FCA, HMRC and the Minister for Security seeking answer to a number of questions in the light of the release of the FinCEN papers. Mel Stride’s letter asks: what needs...
FCA sets out views on cannabis-related businesses
FCA has set out its views on how it is assessing applications for listing from cannabis-related companies. It notes that, although medicinal cannabis has been legalised in the UK, there is a risk that the proceeds from...
Commission reports on MLD4 trust identification
The Commission has reported to the Council on whether Member States have identified trusts and similar arrangements and made them subject to the provisions of MLD4. It notes that 3 lists have been published, and from...
FATF reports on red flag indicators in virtual assets
FATF has published a report on virtual assets red flag indicators of money laundering and terrorist financing. The report focuses on: technological features that increase anonymity; geographical risks; transaction...
FCA and PSR publish annual reports
FCA has published its annual report and accounts for 2019/20. The report notes FCa’s key achievements for the year. Apart from the obvious measures to address the problems caused by Covid-19, it highlights:...
EBA calls for single AML rulebook
EBA has published its response to the European Commission’s call for advice on how to strengthen the AML/CFT legal framework. It feels the only way to tackle vulnerabilities that come from divergent practices...
FCA censures individual for market abuse
FCA has publicly censured the former CEO of Worldspreads and banned him from any roles linked to regulated activity, as as result of market abuse. It originally fined Conor Foley around £650,000 but imposed a public...
SFO updates on enforcement activities
Lisa Osofsky has spoken on SFO’s most recent enforcement activity and its priorities for the future. She spoke about how SFO has worked on its priorities of better cooperation, use of technology, intelligence...
FCA reminds firms of market abuse investigation protocol
In its latest edition of Market Watch, FCA focuses on how market participants should act when they receive information requests from FCA when it is investigating possible market abuse. It stresses that: if firms handle...
OFSI publishes frozen asset report form
OFSI has published the form on which firms need to make their 2020 frozen assets report. It requires information from relevant firms by 16 October.
FMLC responds on AML action plan
FMLC has responded to the Commission’s consultation on its AML action plan. The response focuses on: the scope of EU AML legislation on virtual currencies, and how it might be helpful to broaden the definition;...
FCA consults on extension of fin crime reporting
FCA is consulting on the possible extension of its annual financial crime reporting obligation. It wants to include firms that carry on activities that potentially pose a higher money laundering risk. FCA currently...
Court says Treasury should tell whereabouts of frozen assets
A consortium of reinsurers had tried, unsuccessfully, to trace funds owned by the Syrian state and its agents. The funds are frozen as a result of sanctions, and if the reinsurers could locate them, they would ask the...
HMRC publishes list of MLR miscreants
HMRC has published its list of businesses who, over the past tax year, have not complied with their obligations under the MLRs. Over the period, there were 15 “major” penalties, including a fine of nearly...
EBA responds to the Commission’s AML/CFT Action Plan
The European Banking Authority (“EBA“) has published its response to the European Commission’s Action Plan for a comprehensive Union policy on preventing money laundering and terrorism financing. The Action...
Amelia GreenTreasury approves JMLSG Guidance on pooled client accounts and cryptoasset exchange providers
The Joint Money Laundering Steering Group (“JMLSG“) has received HM Treasury ministerial approval for its guidance material published in June/July this year. This includes the new Sector 22 Cryptoasset...
Wolfsberg updates on effective AML programmes
The Wolfsberg Group has published a statement on steps financial institutions can take to evolve their AML./CTF regimes to meet the key elements of the Wolfsberg effective programme. It outlines the key steps as: assess...
Wolfsberg Group publishes SOW and SOF FAQs
The Wolfsberg Group has published FAQs on how Financial Institutions can identify, mitigate and manage money laundering risks by undertaking Source of Wealth and Source of Funds checks on relevant customers, when...
Treasury publishes annual AML/CFT supervision report
Treasury has published the annual report for AML and CFT for 2018-19. The report looks at the work done on supervisory activities and on promoting and ensuring compliance. There is a section devoted to the FATF key...
Up next from FCA
FCA’s latest Policy Development Update heralds: consultation on financial crime reporting during Q3; PS on debt advice levy rates in Q4; CP on exit fees in investment platforms and comparable firms during 2021; PS...
PSR focuses on APP scams
The PSR has stressed the importance of the CRM Code in reimbursing victims of APP scams. It notes the Covid-19 pandemic has changed the way many people make payments, and left many of them vulnerable to fraud. The Code...
OFSI updates guidance and issues maritime guidance
OFSI has updated various guidance and FAQs, including on monetary penalties. The update includes targeted FAQs for:
the charity sector;
the import and export sector; and
maritime.
Insurance Europe issues consultation response on EU plan for AML policy
Insurance Europe has published its response to a consultation by the European Commission (“the Commission“) on its action plan for a comprehensive EU policy on preventing money laundering (“ML“)...
JMLSG publishes new Guidance on pooled client accounts and cryptoasset exchange providers
The Joint Money Laundering Steering Group (“JMLSG“) has today published two new pieces of Guidance. The Board approved text includes a new annex within Part I: Annex 5-V on Pooled Client Accounts, and a new...
Treasury consults on economic crime levy
Treasury is consulting on the introduction of the economic crime levy, announced in the Budget, which aims to raise around £100m per year. It wants views on: the design principles of the levy how it can operate in...
Ireland and Romania fined for late implementation of MLD4
The Court of Justice of the EU has fined Ireland €2m and Romania €3m for failure to transpose MLD4. Both jurisdictions had neither transposed the Directive in full nor notified the Commission of the measures they had...
Overseas Terroritories agree beneficial ownership registers
Baroness Sugg has welcomed the statements of 8 Overseas Territories that they will establish publicly accessible registers of beneficial ownership of companies. Anguilla, Bermuda, the Cayman Islands, the Falkland...
HMRC feeds back on trust registration
HMRC has published a summary of the responses it received to its consultation on MLD5 and the Trust Registration Service. The consultation had over 100 responses, and the key messages were: most respondents agreed with...
MEPs approve ML action plan
MEPs have resoundingly backed the Commission’s action plan for fighting money laundering and terrorist financing. In a press release, the European Parliament said it “deplores” the incorrect and patchy...
FATF reports on stablecoins and virtual assets
FATF has published 2 reports: its report on “so-called Stablecoins” looks at the characteristics of stablecoins, their ML/TF risks and how FATF standards currently apply to them and businesses that are...
Treasury imposes Global Human Rights sanctions
Treasury has used its powers under SAMLA to make autonomous UK sanctions against those who violate global human rights. It has made the Global Human Rights Sanctions Regulations 2020, and the FCO has made statutory...
Commission confirms MLD4 enforcement actions
The European Commission has confirmed further actions against Member States for failure correctly to transpose MLD4. It has sent letters of formal notice to Luxembourg, Slovakia and Slovenia, reasoned opinions to...
Up next from FCA
Over the rest of 2020, FCA plans the following: consultations on mortgage borrowing and mortgage prisoners (now overdue), debt advice levy rates and exist fees in investment platforms (Summer 2020) and on financial...
Basel Committee finalises AML/CFT guidelines
The Basel Committee has published the updated version of its guidelines for supervisors on co-operation in relation to the sound management of risks related to money laundering and the financing of terrorism. Among the...
Court of Appeal upholds Cynergy judgement
The Court of Appeal has upheld the judgment that a borrower was justified in its refusal to make payments under a loan where the ultimate beneficial owner of the lender was an OFAC SDN. Cynergy Bank (a UK bank) had...
FCA makes new rules
FCA has published a Handbook Notice covering the rules it made at its May and June Board meetings. changes to COBs in relation to pension transfers, introducing a ban on contingent charging in respect of most advice on...
MLD4 high-risk list in OJEU
The revised list of high-risk third countries for AML purposes has been published in the OJEU. The new list applies from 1 October, and will comprise: Afghanistan Bahamas Barbados Botswana Cambodia Ghana Iraq Jamaica...
FCA reminds crypto businesses to register
FCA has reminded businesses that carry on cryptoasset activity in the UK to register with it for AML purposes, if they have not done so already. Firms that were carrying on the activities before 10 January 2020 must...
JMLSG upates on Covid-19 risks
JMLSG has reminded firms of FCA’s guidance on managing financial crime risks throughout Covid-19 and has also commented on the disruption the pandemic is causing to documents often relied on for CDD purposes. It...
FCA fines Commerzbank for AML failings
FCA has fined Commerzbank AG London Branch nearly £38m for AML systems and controls failings spanning a 5 year period to September 2017. The bank benefited from a 30% discount for early settlement. Many of the...
EBA looks to understand derisking
The EBA has issued a call for input better to understand the scale and drivers of derisking and its impact on customers. It wants to gain better insight into why finacnail institutions prefer to derisk instead of...
FCA updates market abuse pages
FCA has updated the guidance on its website on reporting suspected market abuse. The guidance includes FCA’s expectations in respect of how firms should make market observations in situations where they will not...
Pay.UK heralds COP launch
Pay.UK has heralded the introduction of Confirmation of Payee and has reminded users of the importance of using “first name surname” rather than a nickname on payment details. Its data shows that 34% of...
Natasha BrownleeEuropol launches economic crime centre
Europol has launched the European Financial and Economic Crime Centre to give better operational support to Member States and EU bodies fighting financial and economic crime. It has also published a report looking at...
FCA publishes quarterly CP
FCA is returning to some regular business and has published a short quarterly consultation, proposing changes to: clarify FSCS’s power to declare in default firms and successors subject to the proposed new...
EVENT: Retail Banking Mixer Webinar
Our next r=Retail Banking Mixer will be held by webinar on 18th June at 10am. We are delighted to be joined by Rosemary Ford and Amber Andrade from Deloitte this time. The webinar continues the focus on COVID-19. Our...
Caroline StevensonCommission updates on MLD transposition
The European Commission has updated its website to show the state of transposition and infringement actions in respect of the Money Laundering Directives. The UK is no longer mentioned. In respect of MLD4, all Member...
JMLSG updates guidance
JMLSG has published its final amendments to its guidance to take account of the implementation of MLD5, and which it consulted on in February. It has submitted the changes to Treasury for approval.
OFSI reports on TAFA
OFSI has submitted its latest quarterly report to Parliament on the operation of the UK asset freezing regime under TAFA. The report covers the quarter to the end of 2019 and notes: only £9,000 of funds were frozen...
Market Watch Covid special
FCA’s latest edition of Market Watch looks at market conduct and discipline in the context of coronavirus. It stresses particularly the importance of complying with the standards of MAR. Given the likely need for...
EP updates on MLD4 high-risk list
The European Parliament’s legislative observatory notes that the revised MLD4 high-risk third country list is now awaiting a committee decision. Meanwhile, the UK is among 9 jurisdictions from whom the Commission...
JMLSG consults on pooled client accounts
JMLSG is consulting on some new draft text for Chapter 5 of Part 1 of its guidance dealing with pooled client accounts. JMLSG considers the key risks of PCAs are where a customer’s clients misuse a PCA without the...
FCA updates on Innovation Hub help
FCA has updated its information on requesting Innovation Hub support in light of Covid-19. It wants to hear from firms who have creative and innovative solutions to the challenges the virus is posing, and is...
EBA addresses financial crime risks of dividend arbitrage
EBA has conducted an inquiry into dividend arbitrage trading schemes. It concluded that differences in domestic tax laws mean that national authorities do not share the same understanding of these schemes. As a result...
NCA updates guidance on better SARs
NCA has published an update to its guidance on how to submit better quality SARs, and a set of FAQs to accompany it. The guidance stresses that a properly made SAR will give the enforcement agencies a quick picture of...
Government agrees cross-border information sharing
The Government has endorsed cross-border information sharing within corporate groups as a weapon to combat financial crime. The Government says sharing can help both the private sector and government agencies, but where...
EU launches AML policy
The European Commission has adopted an action plan for an EU policy on preventing money laundering and terrorist financing. It wants to deliver, by early 2021: effective implementation of existing rules a single EU...
FCA speaks on response to Covid-19 and Brexit
Nausicaa Delfas has spoken on FCA’s national and international response to Covid-19 and Brexit. On Covid-19, she noted: FCA’s priority to keep markets open and orderly, help firms continue to operate...
FCA sets Covid-19 financial crime prevention expectations
FCA has set out the systems and controls it expects firms to have in place to continue to manage their financial crime risks during Covid-19. It appreciates firms will face operational challenges, but also notes that...
Regulator Covid-19 update 6 May: SMCR, financial crime systems and other updates
On 6 May: FCA published a modification by consent and a direction to enable all solo-regulated firms to arrange for an unapproved senior manager to cover SMFs in an emergency, from the normal 12 weeks to 36 weeks, as...
FATF updates on Covid-19 risks
FATF has considered the financial crime risks that Covid-19 has created, and is looking at how to address them. It is particularly concerned at, for example, how criminals may seek to bypass CDD measures, use online...
FCA publishes skilled person data
FCA has publicised the number of skilled persons reports commissioned in January to March 2020. It commissioned 24 in total, of which 9 related to retail banking and 6 to retail lending. 6 of the reports were on...
Regulator Covid-19 Update 27 April
On 27 April: FCA has clarified the relationship between its rules and the UK’s CBILS and Bounce Back Loan schemes. It notes that, pending the roll-out of the BBL scheme, which, from 4 May, will give small...
Jonny WilliamsWolfsberg Group updates CBDDQ
The Wolfsberg Group has updated its Correspondent Banking DDQ and supporting documents. The changes update the documents and focus on ease of use and readability.
FOS publishes help on avoiding scams and fraud
The Financial Ombudsman Service (“FOS“) recognises that the type of complaint it sees is constantly evolving, as fraudsters develop new methods or seek to exploit events, such as the current impact of Covid...
TI disappointed at UWO overturning
Transparency International has expressed its disappointment at the High Court’s decision to dismiss UWOs that would have required family members of the former Kazakh President to explain how they acquired £80m of...
PSR publishes APP scam thoughts
The PSR has published a summary of a conference call between key players in the payments industry to discuss the progress being made in tackling APP scams. It decided to go ahead with the call, not least as Covid-19 has...
FCA Business Plan 20/21
The FCA published its business plan for the coming year this morning. The plan focuses around 5 key priorities for the year. It has been significantly reshaped because of coronavirus as it was intended to show the...
Regulator Covid-19 update 1 April
Further updates from the regulators, in addition to FCA’s Dear CEO letter to retail investment firms, include: PRA welcoming the agreement by the boards of large UK banks to suspend dividends and buybacks on...
OFSI fines Standard Chartered £20m for sanctions breaches
OFSI has published details of two monetary penalties totalling £20.47m on Standard Chartered Bank for breaches of sanctions against Ukraine, following a voluntary disclosure by the bank. OFSI levied two separate fines...
JMLSG consults on crypto guidance
JMLSG is consulting on a new part to its sectoral guidance, to cover cryptoasset exchange providers and custodian wallet providers. The new Part 22: defines crypto-assets, noting some examples which firms should...
Gambling Commission fines for AML failings
The Gambling Commission has fined Betway £11,6m for a series of “social responsibility” and money laundering failings linked to 7 VIP customers. The Gambling Commission found that: generally, because the...
Treasury Committee responds on IT failure and economic crime reports
The Treasury Committee has commented on the responses from Government and regulators on: its October report on failures in the IT industry. The report had concluded, among other things, that: regulators need to improve...
TI welcomes economic crime levy
Transparency International has welcomed the Government’s announcement of an economic crime levy on firms subject to the MLRs. The Government will consult on its plans later in the spring.
FCA publishes insights from the Cyber Coordination Groups
As cyber risk continues to be a complex challenge for the financial sector, in 2017 the FCA brought together over 175 firms to collaborate in groups on cyber security and operational resilience. These Cyber Coordination...
FCA compares bank fraud controls
FCA has published data on the fraud controls banks have in place, intended to help consumers compare what different banks do. UK Finance asked banks: what their approach to fraud prevention was; what controls the firm...
FATF publishes guidance on digital ID
FATF has published a report giving guidance to regulators and firms on how to determine whether a digital ID is an appropriate CDD tool. The report looks at how digital ID systems work, and what their key features are...
FCA speaks on digital assets
Therese Chambers has spoken on the financial crime risks presented by stablecoins and other digital assets. She spoke of: early attempts to launch non-state backed digital currency, and Bitcoin’s predecessors...
Up next from FCA
FCA plans the following publications: consultation on exit fees in investment platforms and comparable firms (March); consultation on listing of OEICs (Q1); consultation on changes to DEPP, EG and the financial crime...
FCA publishes 2019 data on STORs
The FCA has published its suspicious transaction and order reports (STORs) figures for the year ending December 2019. The number of STORs had increased consistently since 2016; however, the data for 2019 appears to buck...
Rachael PrestonCLLS views on TRS extension
CLLS has input its view on the extension to the TRS. As with other respondents, it notes several types of trust it thinks should be out of scope, including: trust arrangements that are incidental to a corporate...
Government “considering” corporate economic crime offence
In response to a question in Parliament, the Government said it is still considering its response on introducing a corporate offence for economic crime – on which consultation closed in 2017.
APP Scams Interim Funding Extension
UK Finance confirmed on 27 February that the payment service providers who have provided the interim funding arrangement since May last year, have agreed to extend their funding to the end of the year (31/12/20). This...
Treasury updates AML advisory
Treasury has updated its AML advisory in the light of the most recent FATF plenary. The notice confirms that counter measures and enhanced due diligence should be applied in respect of North Korea and Iran, and...
Barnier to be EU negotiator on post-Brexit issues
The Council of the EU has adopted a decision authorising negotiations between the EU and UK towards a new partnership and authorising the European Commission, in the person of Michel Barnier, as the EU negotiator. The...