Archive for the ‘Anti-Money Laundering legislation’ Category

Portugal issues Legal Regime on the Beneficial Ownership Central Register

Wednesday, September 19th, 2018

The Ministerial Order 233/2018, which regulates the Legal Regime on the Beneficial Ownership Central Register, was issued in Portugal.

On August 21, was issued the Ministerial Order 233/2018, which regulates the Legal Regime on the Beneficial Ownership Central Register (BOCR Legal Regime). However, the regulations are still not complete, since the forms for compliance of the disclosure requirements under the BOCR Legal Regime must still be published on the website of the Justice sector. In addition, it requires that such forms will include the circumstances indicating of the status of beneficial owner that must be taken into account when filling out the form.

The first beneficial owner declaration for the companies already in existence on 1 October 2018 must be made between 1 January 2019 and 30 April 30 2019.

The obligations under this legal regime must be fulfilled by filing the said form.

5th EU Anti-Money Laundering Directive published

Friday, July 20th, 2018

On June 19th, 2018, the 5th EU Anti-Money Laundering Directive (AMLD 5) was published in the official journal of the European Union.

The AMLD5 modifies the 4th Anti-Money Laundering Directive (AMLD4) released only in 2015. The EU Commission proposed the revised AMLD in July 2016 as part of its Action Plan against terrorism announced in February 2016, after the attacks in Paris and Brussels, and as a reaction to the Panama Papers published in April 2016. The plan to implement the changes by January 2017 resulted overambitious; a final compromise text was reached only in December 2017. The new directive entered into force on July 9th, 2018. Member states are obliged to transpose the modified regulations into national law by latest January 20th, 2020.

The above mentioned Anti-Money Laundering Directive includes the following:

  • it extends the scope to virtual currency platforms and wallet providers, tax related services and traders of art;
  • grants access to the general public to beneficial ownership information of EU based companies;
  • makes it an obligation to consult the beneficial ownership register when performing AML due diligence;
  • obliges member states to create a list of national public offices and functions that qualify as politically exposed (PEP);
  • introduces strict enhanced due diligence measures for financial flows from high-risk 3rd countries;
  • ends the anonymity of bank and savings accounts, as well as safe deposit boxes and creates central access mechanisms to bank account and safe deposit boxes holder information throughout the EU;
  • makes information on real estate holders centrally available to public authorities;
  • lowers thresholds for identifying purchasers of prepaid cards and for the use of e-money;
  • enhances the powers of the FIUs and facilitates cooperation and information exchange among authorities.

 

UK to force offshore centres to make public the owners of companies

Friday, May 4th, 2018

The UK parliament made a decision to force its overseas territories to make public the owners of companies registered in their jurisdiction, if necessary through an order in council.

Most of British news organizations celebrated this as a victory for transparency campaigners and a major push against offshore secrecy, while the constitutional concerns expressed by the majority of overseas territories’ leaders about British MPs legislating the affairs of largely autonomous territories received very little attention.

The Guardian acknowledged that there may be legitimate reasons to use offshore jurisdictions. “But kleptocracy – egregious and globalized grand corruption – is enabled by anonymous companies, which strip the fingerprints off stolen money and, having done so, hide it under the cover of supposedly respectable corporations. Once all traces of the money’s origin have been removed, the thieves can spend it on New York property, European passports or western politicians, and they do it in vast quantities,” the Guardian said. Accordingto the article, “many of these companies came from the British Virgin Islands, Gibraltar, Anguilla and the other pink dots left on the map of the world, which is why Tuesday’s vote in parliament was so celebrated”.

Also, the Guardian connected Tuesday’s decision directly to the Panama and Paradise Papers.

British tabloid The Daily Mirror attacked one of the few politicians who spoke up on behalf of the overseas territories. It said that Conservative MP Geoffrey Cox “defended tax havens in Parliament after a GBP40,000 Cayman Islands payday” stating the “millionaire MP” had failed to mention in Tuesday’s House of Commons debate that he once represented former Cayman Islands Premier “McKeeva Bush in a corruption trial over his use of government credit cards in casinos.” IT is worth reminding that Mr. Bush was found not guilty in the trial.

News agency Bloomberg welcomed the United Kingdom’s move in a commentary stating it would “let the sunshine in on tax havens” but cautioned that the new transparency would have to be backed by enforcement. It said that corporate anonymity is what had made the British Overseas Territories a huge attraction for overseas money. Open registers “should sow seeds of panic in the offshore financial ecosystem, which has played a central role in recent money laundering and tax evasion scandals.”

The Financial Times analyzed why British Overseas Territories “fear” that the transparency push could “undermine their positions as leading offshore financial centers.”

The potential for legal action by Cayman and Bermuda against an order in council was discussed. However, Tory MP Mr. Mitchell said this was unlikely to be successful. He said that the jurisdictions have to do this by 2020.

Switzerland consults on implementing AEOI Agreements

Thursday, December 29th, 2016

The Swiss Federal Department of Finance (FDF) has launched a consultation aimed to introduce the automatic exchange of information (AEOI) related to tax issues with a list other countries.

The consultation will run until March 15, 2017.

The list includes the following jurisdictions:
Andorra,
Argentina,
Barbados,
Bermuda,
Brazil,
the British Virgin Islands,
the Cayman Islands,
Chile,
the Faroe Islands,
Greenland,
India,
Israel,
Mauritius,
Mexico,
Monaco,
New Zealand,
San Marino,
the Seychelles,
South Africa, Turks and Caicos,
Uruguay.

The AEOI with the above-mentioned countries is to enter into force on January 1, 2018, with the first exchanges to take place in 2019.

The FDF said that the introduction of the AEOI with these countries confirms Switzerland’s international commitment to implementing the AEOI standard as well as strengthens the competitiveness, credibility, and integrity of Switzerland’s financial center. The implementation of the AEOI will be based on the Multilateral Competent Authority Agreement on the Automatic Exchange of Financial Account Information.

In 2017, Switzerland will introduce the AEOI with EU member states, Australia, Iceland, Norway, Japan, Canada, South Korea, and the British crown dependencies of Jersey, Guernsey, and the Isle of Man. To enter into force, the agreements require parliamentary approval of these countries.

US Offshore Disclosure Revenue above USD 10 billion

Wednesday, October 26th, 2016

With 55,800 taxpayers participating in the US Offshore Voluntary Disclosure Program (OVDP) since 2009, the Internal Revenue Service (IRS) announced that it has collected more than USD 9.9 billion in taxes, interest, and penalties from the initiative to date.

The IRS added that another 48,000 taxpayers have used the streamlined filing compliance procedures to correct prior non-willful omissions and meet their federal tax obligations, paying approximately USD 450 million in taxes, interest, and penalties.

Both the Offshore Voluntary Disclosure Program and the streamlined procedures allow taxpayers with undisclosed income from foreign financial accounts and assets to correct and regularize their affairs while mitigating penalties.

IRS Commissioner John Koskinen said: “The IRS has passed several major milestones in our offshore efforts, collecting a combined USD 10 billion with 100,000 taxpayers coming back into compliance. He noted that, when receiving more information on foreign accounts, people’s ability to avoid detection becomes harder and harder. So, the IRS urges those people with international tax issues to come forward to meet their tax obligations.

Besides the OVDP and the streamlined procedures, the IRS noted that, under the Foreign Account Tax Compliance Act and the network of inter-governmental agreements between the US and partner jurisdictions, automatic third-party account reporting has entered its 2nd year.

UN expert calls on new boss to fight Tax Havens

Thursday, October 20th, 2016

The new United Nations Secretary-General, António Guterres, is being asked by one of the body’s human rights experts to call a world conference on tax avoidance and evasion, with a view to abolish all tax havens.

The UN’s independent expert on the promotion of a democratic and equitable international order, Alfred de Zayas, said that Guterres’ appointment as the new UN leader offered “a unique opportunity to advance the fight against tax evasion and illicit financial flows” when the world’s attention is on these crucial problems.

“Trillions of dollars necessary for combatting extreme poverty and addressing climate change are being kept offshore, thus escaping just taxation and effectively stealing hundreds of billions of dollars each year from the public treasuries,” he stated.

He also noted: “Widespread tax avoidance, tax evasion, tax fraud and profit-shifting, facilitated by bank secrecy and a web of shell companies registered in tax havens, are now routinely documented, but their true human cost is only revealed progressively”, following the publication of his report to the General Assembly on these matters.

According to him, a growing number of human rights experts were pointing to tax abuse as a human rights issue.

“Corruption, bribery, tax fraud and tax evasion have such grave effects on human dignity, human rights and human welfare that they shock the conscience of mankind. They should be prosecuted nationally and internationally,” de Zayas said.

UK bill to open details on multinational Tax Evasion

Friday, September 9th, 2016

A legislative amendment in the United Kingdom this week will give the British government the power to publish details of tax payments made by UK-based multinational corporations on a country by country basis, as tax authorities try to clamp down on the abuse of tax laws and aggressive tax avoidance.

The change in the law followed cross-party calls for companies to publish the details of where they do their business and the tax they pay in each place, which came in response to the controversy surrounding a deal between the government of the UK and Google to repay GBP 130 million in back taxes earlier this year.

In August, the European Commission ruled that Ireland should recover up to EUR 13 billion from Apple in back taxes.

Director of the Financial Transparency Coalition described it as a welcome step but said it was important for the government to actually use the power it now has by releasing country by country reports of UK multinationals to the public as quickly as possible. He said: “It’s time to break out of perpetual scandal mode and make some changes to business as usual. A financial system that relies on plausible deniability and shifting responsibility is inherently shaky, and it’s simply not sustainable.”

Belize to enhance Anti-Money Laundering

Sunday, May 22nd, 2016

To strengthen the jurisdiction’s safeguards against financial crime, Belize’s Financial Intelligence Unit and Belize Police have signed a memorandum of understanding.

The memorandum will strengthen the existing cooperation and facilitate the analysis and investigation of suspected money laundering, associated offenses, and the financing of terrorism. Implementation of the document is expected to increase the potential sources of information available to both the Financial Intelligence Unit and the Police in their fight against crime. Also, joint operations between the authorities will be possible.

The Financial Intelligence Unit is the Belizean authority dealing with the enforcement and implementation of all anti-money laundering and counter-terrorism financing regulations and the prevention of domestic tax evasion.

Angola removed from Money Laundering Blacklist

Saturday, February 20th, 2016

The Financial Action Task Force (FATF) has removed Angola from its blacklist of jurisdictions that fail to meet international standards.

The FATF added this southern African country to the list in 2010. The Angolan central bank said the FATF’s decision came after the country implemented reforms that included licensing of banks and setting up a Financial Intelligence Unit, which collects information on suspicious or unusual financial activity.

The removal is expected to improve the credit quality and financial institutions of Angola.

Last year, the risk of financial crime and difficulty in monitoring clients forced Standard Chartered to announce it had ended its dollar-clearing operations with commercial banks in Angola. Bank of America also stopped selling Angolan banks the greenback from the beginning of December 2015.

Swiss Government Adopts New Anti-money Laundering Rules

Wednesday, November 11th, 2015

On November 11, 2015, the government of Switzerland adopted new rules aimed to clamp down on money laundering as the country seeks to cast off its reputation as a haven for hidden cash.

The new rules, which follow recommendations by the Financial Action Task Force (FATF) last year, establish fresh due diligence requirements for traders when they accept cash payments of more than 100,000 Swiss francs (USD 99,500).

According to the statement made by the Swiss government, they also change the way in which religious foundations are registered in Switzerland and will come into force at the start of the year 2016.

Switzerland was reminded of its reputation as a place for the wealthy to hide assets this year when media outlets published leaked documents suggesting HSBC’s Swiss private bank helped customers dodge taxes.

In June, the Swiss banking association had said that the country’s banks would beef up anti-money laundering measures through transparency rules due to come into force next year.