Tag Archives: MLD4
The Commission has published a fact sheet on its new list of high-risk third countries for the purposes of MLD4. The new list contains 12 jurisdictions from the FATF list: the Bahamas, Botswana, North Korea, Ethiopia, Ghana, Iran, Pakistan, Sri Lanka, Syria, Trinidad and Tobago, Tunisia and the Yemen, and 11 additional jurisdictions: Afghanistan, American […]
The Commission has published the final form of RTS under MLD4 aimed at better and more consistent measures in approaching ML/TF risk where credit or financial institutions have a presence in a third country whose laws do not permit group-wide policies. The RTS set the ideal minimum standards groups should attain, and how they should […]
The European Commission has adopted a Delegated Regulation adding Pakistan to the list of high-risk third countries under MLD4. Member States will be bound to require application of EDD when dealing with any persons from Pakistan. The requirement will take effect 20 days after it is published in the Official Journal.
Commission Delegated Regulation (EU) 2018/1108 has been published in the OJ. This Regulation sets out RTS relating to the criteria for determining when it may be appropriate to require electronic money issuers and payment service providers who have certain cross-border operations to appoint a central contact point for a particular territory. The RTS also address the […]
The European Commission is unhappy with Member State transposition of MLD4. It currently has open infringement procedures against 20 Member States but says most have adopted and notified missing transposition measures. The Commission is now scrutinising those measures, while noting Member States have only until January 2020 to implement MLD5. The Commission is also looking […]
The Commission has confirmed it will assess, at the end of June, Serbia’s progress and commitments towards meeting its AML obligations and the FATF recommendations. It may then decide to add the country to the list of high-risk jurisdictions under MLD4.
MEPs have approved the proposal to add Tunisia, Sri Lanka and Trinidad and Tobago to the list of high-risk third country jurisdictions under MLD4. The vote passed the additions, despite continuing dissatisfaction among many MEPs over the inclusion of Tunisia.
The Economics and Home Affairs Committees in the EP have voted through additions to the Commission’s MLD4 blacklist of high risk jurisdictions by the narrowest of margins. The proposal was to include Tunisia, Sri Lanka and Trinidad and Tobago in the list. The debate was over the inclusion of Tunisia. Many MEPs expressed incomprehension that […]
The Commission’s Delegated Regulation adding Ethiopia to its list of high risk countries under MLD4 has been published in the OJEU.
The ESAs have published draft RTS under MLD4 on how credit and financial institutions should manage their AML/TF risks at group level where their group includes branches or major subsidiaries in third countries that do not permit group wide policies to be used. The RTS include practical steps institutions should take, such as: getting customer […]
The Commission has made a delegated regulation under MLD4 to add Ethiopia to the list of high risk third countries. It notes that its work to find the most appropriate way of assessing which jurisdictions should be on the list is still underway, but that in the interim it is appropriate to add Ethiopia to […]
In an attempt to solve the current problems around the Commission’s proposals for a list of high-risk jurisdictions for the purposes of MLD4, the Council is now proposing a methodology the Commission should use when proposing the list. The proposal is for a staged approach over the next few years, so does not solve the immediate […]
FCA has published its finalised guidance on the treatment of PEPs for AML purposes. It received 43 responses to its consultation on the guidance, all but one of which was in favour of guidance being issued, but many of which raised significant comments. FCA has responded to the comments and made some changes to clarify […]
The Scottish Partnerships (Register of People with Significant Control) Regulations 2017, made on 22 June and taking effect mainly from 26 June, have been published. The Regulations transpose Article 30 of MLD4 on beneficial ownership for Scottish Limited Partnerships and certain Scottish general partnerships. They require registration by qualifying partnerships, and impose an obligation to […]
Transparency International has welcomed the changes the Government has made to implement the MLD4 beneficial ownership requirements in respect of Scottish Limited Partnerships. It had previously expressed significant concerns that the unique features of SLPs enabled them to be used as shell companies and present a “respectable” UK front to illicit activity. Surveys by TI […]
The ESAs have published draft RTS to help Member States work out when PSPs and E-money issuers should appoint a “central contact point” to help effective AML oversight of the activities of their networks in “host” Member States.
BEIS has published updated guidance to reflect the effects of MLD4 on the PSC Register and regime.
The ESAs have published their final guidelines on AML and CFT required under MLD4. The guidance is intended for credit and financial institutions and should provide them with the tools they need to make risk-based decisions on their management of business relationships and occasional transactions. There are some general guidelines and some sector-specific ones. The […]
The Commission has published its report to the EP and Council on its assessment of the AML and TF risks affecting the internal market and relating to cross-border activities. It published the report, and supporting working papers, as it heralded implementation of MLD4.
Treasury has published the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, which were laid before Parliament late on 22 June to come into force to meet MLD4 deadlines, on 26 June. JMLSG has also published the finalised updates to its guidance, which it now needs to submit to […]
FCA is consulting on changes to its Handbook and Guidance to ensure it is in line with MLD4 and the Fund Transfer Regulation. The draft MLRs that will replace the 2007 version give FCA greater supervisory powers over both regulated firms subject to the MLR and “Annex 1 financial institutions”. The changes affect only DEPP […]
JMLSG has published (on 10 June) its consultation draft of changes to the electronic money chapter within Part 2 of its guidance. It asks for comments by 20 June – justifying the short period by saying the chapter is of limited interest to the wider financial sector and has essentially been revised only to reflect MLD4 […]
The EP has adopted a resolution on the influence of technology on the financial sector. The provisional version of the resolution focuses on the rapid development of applications of fintech technologies and notes that some may become of systemic importance. It looks at the benefits and risks of the developments and notes that some applications […]
Unsurprisingly, the European Parliament has again rejected the Commission’s proposed list of high risk third countries under MLD4.
JMLSG is consulting, until 26 May, on updates to parts of its guidance within parts 2 and 3. It has already published a mark up of part 1 of the guidance for comment. Certain parts of part 2 have not been changed (yet, although the entire part will be updated with new references in due […]
The Economic and Monetary Affairs Committee and the Civil Liberties, Justice and Home Affairs Committee have again rejected the Commission’s list of high-risk jurisdictions under MLD4. This is maybe not surprising, given the Commission had made only one change from the previous version, and the Committees’ opinion is that the Commission should not just follow […]
The Council has decided not to object to the Commission’s revised list of high-risk jurisdictions for the purposes of MLD4. This means the Regulation can enter into force unless the European Parliament objects. The list is as originally suggested by the Commission except that Guyana is deleted and Ethiopia takes its place.
We have prepared a commercial insurance timeline which highlights key legislation, regulation, cases and other developments that impact on the industry. This timeline covers developments from March 2017 onwards.
The EP is to debate the Commission’s revised draft Delegated Regulation under MLD4 that identifies high-risk third countries. The Commission has removed Guyana from its list and added Ethiopia. EP has asked for more time to consider the amended draft (having rejected its predecessor).
The ESAs have published the official translations of the guidelines on the characteristics of a risk-based approach to AML and TF supervision under MLD4. It finalised the guidelines last November, but the translation triggers their national application. The deadline for compliance is 23 June.
The UK has decided to exercise its right to opt-in to the proposed changes to MLD4 that would facilitate data sharing between financial intelligence units and enforcement authorities.
JMLSG is consulting on revisions to its guidance, in light of the proposed new legislation implementing MLD4. The consultation covers changes to part 1, and includes a marked up version of each chapter. JMLSG says it has taken the opportunity not just to align the guidance with the draft MLR 2017 but also to make […]
FCA has published a guidance consultation on treatment of PEPs under the draft 2017 MLRs. FCA is obliged to issue the guidance, which it says it has prepared using information it has on when firms have not applied CDD measures that were proportionate with the risk a PEP posed. The draft guidance stresses that is […]
Treasury has published its feedback to its consultation on implementing MLD4 into UK law and the draft Money Laundering Regulations 2017. We will cover the consultation in more detail in a separate article. They key points, however, include: that the turnover threshold for those who engage in financial activity on a limited basis will increase […]
ECON and the Civil Liberties committee in the EP are pressing for further amendments to MLD4 to allow EU citizens to be able to access registers of company beneficial owners without having to show they have a “legitimate interest”. They also called for a public register showing the beneficial owners of trusts. Other changes discussed included requiring virtual […]
The European Parliament has rejected the Commission’s “blacklist” of states at the highest risk of money laundering. As expected the EP’s vote confirms its belief that the list is too limited and should at least include countries at high risk of tax crimes. The Commission must now consider changes to its proposal, but this will […]
On 9 January 2017, two Committees within the European Parliament, ECON and LIBE published a motion for a resolution (dated 13 December 2016) objecting to the proposed Delegated Regulation amending the European Commission’s list of high-risk third countries under MLD4. The Commission says it has to identify high-risk countries exclusively on the grounds listed in […]
The LMA has responded to HM Treasury’s consultation on the transposition of the Fourth Money Laundering Directive (MLD4) into national law. The LMA has said that there are certain instances where the obligation to disclose the beneficial ownership of legal entities needs to be clarified to avoid disruption to legitimate corporate activities which use beneficial […]
FCA held its annual financial crime conference on 10 November. Among the key points noted by FCA speakers were: Andrew Bailey, in his opening address, highlighting FCA’s “Mission”, and commenting that reliance on prescriptive regulation is not best suited to the evolving risks of financial crime. He also acknowledged the challenges firms face in complying […]
The Council of the EU has published the Opinion of the ECB on the proposed changes to MLD4. In principle, it says it is important that the EU regulates virtual currencies from an AML/CTF point of view, but it does not understand some of the distinctions the proposal makes between various ways of dealing with […]
The Commission Delegated Regulation on identifying high risk jurisdictions for the purposes of MLD4 has been published in the OJEU. The Regulation lists high risk third countries, in line with FATF designations. So North Korea has repeatedly failed to address identified deficiencies, Iran is seeking technical assistance for its high-level political commitment to address its […]
Treasury is consulting on implementing MLD4. It plans to repeal the current MLRs and Fund Transfer Regulations in favour of one piece of secondary legislation. We have produced a more detailed briefing on the paper. The consultation asks several questions, many on firms’ experience of complying with AML legislation and the costs of doing so. The […]
Treasury has submitted a paper on the proposals to update MLD4. Among other things, the Commission had proposed bringing virtual currencies within MLD4, reducing the threshold for CDD on non-reloadable prepaid instruments and removing the online exemption, harmonising approaches to non-compliant third countries, reducing the Beneficial Ownership criteria to 10% for passive non-financial entities and […]