Emma RadmoreTreasury has published the quarterly report on activity under the Terrorist Asset Freezing etc Act 2010. The report covers the quarter to end of September 2020, and shows only £108,000 frozen in 47 accounts, and two...
Category - Financial Crime Prevention
Scott NodderPRA consults on depositor protection I/D verification
PRA is consulting on new rules aimed at avoiding FSCS eligibility issues arising if a firm has failed to conduct adequate AML checks. It stresses the changes are intended merely to provide a backstop if firms’...
FS Bill finishes Commons stages
The Financial Services Bill has now completed its journey through the House of Commons and now moves to the House of Lords. Among the key changes now being debated are extensions to penalties for financial crime-related...
HMRC updates on MLR non-compliance
HMRC has updated its published data on businesses that do not comply with the MLRs. Between February and September 2020 it issued 4 substantial fines for failure to comply with obligations, including a fine of nearly...
FCA Covid financial crime guidance to expire
FCA has updated its pages giving guidance to firms on how to act during the pandemic. As part of this, it has noted that its statement on how firms should apply financial crime systems and controls will no longer apply...
Reminder: changes to MLRs
Various amendments to the MLRs were made in the Money Laundering and Terrorist Financing (Amendment) (EU Exit) Regulations. Some are already in force, with others yet to take effect some of the changes were minor...
Parliament publishes corporate criminal liability briefing
The Commons Library has published a research paper on corporate criminal liabilityr. It looks at the circumstances in which corporates can commit crimes in England and Wales and sets out reform options. The paper...
Court of Appeal upholds insider dealing convictions
FCA has announced the Court of Appeal’s decision in the case it brought against Fabiana Abdel-Malek and Walid Choucair. The individuals had been convicted of five offences each of insider dealing in 2013/14 and...
TAFA report shows little movement
Treasury has published its quarterly report on the functioning of TAFA, covering April to June 2020. The report shows that: total funds of £9,000 were frozen with 6 accounts or payments being frozen, but no new...
UK publishes 2020 NRA
Treasury and the Home Office have published the 2020 National Risk Assessment under the MLRs and presented it to Parliament. The report: looks at what has been done in recent years, including in terms of bringing new...
FCA sets up temporary regime for crypto firms
FCA has set up a temporary registration regime for cryptoasset businesses who have applied for registration with FCA under the MLRs but whose applications FCA is still considering. It is taking FCA longer than hoped to...
EBA pleased at AML college cooperation
EBA has published a report analysing how well AML/CFT supervisory colleges are working. It is pleased that regulators are putting significant effort into setting up colleges, and has reported on good and poor practice...
Treasury makes Brexit financial crime laws
Treasury has made: the Sanctions Regulations (EU Exit) (Commencement) Regulations 2020: these bring into force the sanctions regulations made under SAMLA to set up thematic or country based regimes; and the second...
FCA fines and bans individual for market abuse
FCA has fined a former portfolio manager, partner and CIO £100,00 and banned him as a result of market abuse. Corrado Abbattista worked for Fenicial Capital Management LLP. FCA found he had created a false and...
Treasury makes Misappropriation Sanctions Regulations
Treasury has made the Misappropriation (Sanctions)(EU Exit) Regulations under SAMLA. The purpose is to revoke a number of EU regimes covering misappropriation of State funds, which were specific to a particular...
APP CRM Code interim funding to continue to June 2021
UK Finance has confirmed that 7 signatories to the APP CRM Code have agreed to extend the interim funding to compensate victims of scams until the end of June 2021. The funding will apply where the customer and the...
Commission to remove Mongolia from high risk list
The European Commission has published a draft regulation to remove Mongolia from the MLD4 high risk third country list. Once published in the Official Journal, the change will be effective after 20 days.
EPC Report on Payment Threats and Fraud Trends
The European Payments Council (EPC) has published its report on payment threats and fraud trend for 2020. The report attempts to create awareness amongst stakeholders involved in the payments domain to allow them to...
Angie BamboulisOFSI says “prepare for Brexit”
OFSI’s latest blog alerts firms to the changes they will see at the end of the transition period. It notes that: SAMLA provides the UK’s autonomous legal framework for its sanctions regime the FCDO has...
FATF consults on enhancing cross-border payments
FATF is consulting on how the challenges of cross border payments – namely high cost, low speed, limited access and limited transparency – can best be addressed. The survey builds on the G20 commitment to...
UK publishes retained Blocking Regulation
The DIT has published an information page on the UK Protection of Trading Interests Legislation, which includes the UK retained version of the EU blocking statute. The laws continue to protect UK persons who trade with...
NCA gets record SARs
NCA’s 2020 SARs report shows a 20% increase on the previous period and a total of 573,000 SARs. Of these, nearly 62,500 were DSARs – an increase of 81% on the previous period. NCA also reports £172m as the...
Memo of Understanding: FSCS and SFO
A memorandum of understanding between the Serious Fraud Office and the FSCS has been published. The MoU sets out the parties’ intentions to work together in the public interest to achieve appropriate outcomes in...
Caroline StevensonEBA reminds firms to finalise Brexit plans
EBA has reminded firms that, from the end of the transition period, UK firms can no longer provide services to EU customers on a passporting basis. It notes that: UK financial institutions offering services to EU...
UK Finance reports on post-Brexit sanctions SIs
UK Finance has published the results of a study it has carried out in relation to UK Sanctions statutory instruments, as they will look at the end of the transition period, to assess what differences there will be from...
EBA publishes SREP expectations on TF/ML risks
EBA has published its Opinion in which it sets out how prudential supervisors should consider ML/TF risks as part of the SREP process. The Opinion is another expression of EBA’s exhortation on supervisors to...
Law Commission to examine identification doctrine for economic crime
The Government has published its response on the call for evidence on corporate liability for economic crime. The response summarises the work done to date, and the key reform options of: law to replace common law...
SFO publishes Airline Services DPA
SFO has entered into a DPA with Airline Services Limited, following an investigation into failure to prevent bribery. SFO reports that, under the terms of the DPA, the company accepts responsibility for three counts of...
FATF updates statements
FATF held a plenary meeting on 21-23 October. Many initiatives are on hold while FATF warns firms about the financial crime risks the pandemic has created, but it has continued to work with countries under increased...
FATF updates recommendations
FATF 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...
SFO publishes DPA guidance
The SFO has published a chapter from its handbook that gives guidance on how it approaches DPAs and engages with companies when it is considering a DPA. The guidance, which is internal guidance for SFO staff and...
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...
FCA and PRA fine GSI for 1MDB risk management failures
FCA and PRA have fined Goldman Sachs International a total of £96.1m for risk management failures connected to its role in three fund raising transactions for 1Malaysia Development Berhad, a Malaysian state-owned...
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...
Commission 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...