Anti Money Laundering Blog

A consultation on proposals to amend the Money Laundering Order 2008 and the Anti-Money Laundering/Countering the Financing of Terrorism (AML/CTF) Handbook has been launched by the Jersey Financial Services Commission (JFSC) with a view to revise customer due diligence requirements.

The Consultation Paper has been launched prior a wider review of the basis for, and scope of, customer due diligence concessions in the Money Laundering Order that will take account of international standards set by the Financial Action Task Force (FATF).

According to the Commission, proposals in the Consultation Paper will clarify the additional customer due diligence measures to be taken when a relationship with a customer is established remotely and money laundering and terrorist financing risk is considered to be higher than usually. Also, the JFSC’s reviewed proposals should provide additional guidance on identifying countries with a higher risk of money laundering or terrorist financing. The proposals in the Paper will specify some additional due diligence measures to be applied where a customer has a connection to Iran or North Korea, and where a customer is considered to present a higher risk as a result of a connection to countries like Bolivia, Kenya, Nigeria, Sri Lanka, Syria, Turkey, etc. As the risk of money laundering or terrorist financing occurring is considered to be less for a particular customer, product or service, the proposals are to extend the circumstances in which it may be appropriate to simplify customer due diligence measures.

In the end of September, the Association of Certified Anti-Money Laundering Specialists (ACAMS) hosts its 10th Annual Conference at the ARIA Resort & Casino in Las Vegas. It should be noted that this is its largest gathering of anti-money laundering professionals in both the private and government sector since the association’s inception.

John Byrne, CAMS, ACAMS’ executive vice president, said: “Going into our 10th year, it’s amazing that not only has our association grown to well over 11,000 members worldwide, but that the membership has expanded so well into other industries. This conference highlights our mission that we are comprised of diverse representation from law enforcement, government regulators, bankers, securities broker dealers and money services businesses. The immense turnout only solidifies our mission of providing the best forum to bring together AML professionals for top-notch education, training and networking.”

“Additionally, the audience will hear from and have access to representatives from all of the regulatory bodies including FinCEN, the Federal Reserve, the OCC, FBI and FINRA. Meeting these speakers is essential to better understand your day-to-day challenges.”

On October 1-3, 2012, ACAMS will host its 11th Annual Conference once again at the ARIA Resort & Casino.

The Western Union Company will host the 6th annual Anti-Money Laundering & Anti-Fraud & Compliance Conference in Denver. The event will be held on September 19-22, 2011.

The event that will include more than 200 attendees is held each year for compliance and fraud professionals from across the US and Canada to provide an interactive experience in preventing fraud and money laundering.

More than 40 experts from a variety of government organizations will speak, including the Federal Trade Commission, the Financial Crimes Enforcement Network (FinCEN) of the US Treasury Department, the Financial Transactions and Reports Analysis Centre (FINTRAC) of Canada’s Ministry of Finance, the Internal Revenue Service (IRS) and law enforcement from across the US.

Joe Cachey, Western Union’s Acting General Counsel and Chief Compliance Officer said:. “This event is a unique learning experience, allowing professionals from a wide variety of financial services firms to better identify and protect their organizations against fraud.”

The conference was introduced in 2006 with a view to provide continuing education to Western Union Agents on anti-money laundering best practices, regulations and law-enforcement trends. Since then, the event has grown into one of North America’s largest anti-money laundering/anti-fraud conferences for professionals from various industries.

Under the provisions of the existing anti-money laundering legislation, the India’s Enforcement Directorate is pursuing 1 269 cases. The government is mulling amendment and strengthening of the Act aimed to combat terrorist financing and other suspect transactions.

According to Indian Minister of State for Finance S S Palanimanickam, of the 1 269 cases registered as on March 31, 2011, 11 cases fall under the Unlawful Activities (Prevention) Act, on account of their suspected connection with terrorist financing. He said: “The number of money laundering cases registered by the Directorate of Enforcement under the PMLA has increased from 1 014 cases as on March 31, 2010, to 1 269 cases as on March 31, 2011, based on Scheduled Offences registered and reported by the concerned agencies”.

Palanimanickam said: “The government is proposing amendments to the Prevention of Money Laundering Act. The proposed amendments are at a draft stage and are yet to be finalised”.

He added that India is a member of the Financial Action Task Force (FATF), the Asia/Pacific Group on Money Laundering (APG), the Eurasian group on combating money laundering and financing of terrorism and the Egmont Group of Financial Intelligence Units.

In accordance with police statistics, a 30% increase in the number of cases of money laundering was reported in Sweden for 2010. Such result is the reason to establish a new agency with a view to combat money laundering in this country.

The figures that were released by the financial crimes police (Finanspolisen) reveal that the number of reported money laundering cases in Sweden increased by 3 000 to a total of 12 000 reported cases in 2010.

Sweden has been criticised for not doing enough to fight the problem. Now, the Swedish National Council for Crime Prevention considers the possibility to set up a national financial intelligence centre to be shared by Swedish Police, Customs, Tax agency and Economic Crime Authority. Daniel Vesterhav, researcher at the crime prevention council, said that this way it would be possible to free up resources, make use of each of the authorities’ expertise and increase the quality of operative intelligence.

According to the report, out of the 14,500 companies in Sweden obliged to report possible money laundering crimes within their own organisation, 90% of reports come from banks, foreign exchange companies and other money handling businesses.

It should be noted that no single tax adviser out of Sweden’s 159 obliged to report potential money laundering crimes to police filed any report in 2010.

Thailand’s Anti-Money Laundering Office (AMLO) and Office of Insurance Commission (OIC) have joined with a view to control insurance businesses in Thailand. This move was announced following some drug dealers found to have bought policies for already deceased persons for drug money laundering purposes.

The acting secretary-general of AMLO, Seehanat Prayoonrat, and OIC secretary-general, Jantra Buranareuk,  signed a Memorandum of Understanding. This document is aimed at strictly supervising insurance firms and prevent criminals from using them as channels for money laundering or terrorist financing.

According to AMLO secretary-general Seehanat, the collaboration would be helpful for anti-money laundering work as insurance companies are obliged to report operating results to the OIC every 30 days.

According to an evaluation of anti-money laundering and anti-terrorist financing regime of Canada over the past decade, government authorities still do not share enough information among themselves.

A private consulting firm presented to the Finance Department the report suggesting that a lack of proactive disclosures from Canada’s financial intelligence unit hampered efficiency.

The report criticizes Canada as being on high alert for suspicious transactions from countries in North Africa and the Middle East.

According to this report, the inefficiencies in the regime’s efforts related to the Financial Transactions and Reports Analysis Centre of Canada stem from the tight rules under which the agency has to operate. The report says: “The efficiency of the regime has improved, particularly since 2008, but inefficiencies were found related to the full use of FINTRAC proactive disclosures”. It adds that “these stem from organizational mandates and perhaps the allocation of regime funds, and limitations in information sharing attributable to certain legislative and regulatory provisions.”

The current evaluation says that FINTRAC, an independent agency operating in accordance with rules set out in the Process of Crime and Terrorist Financing Act, needs consent from the Office of the Superintendent of Financial Institutions in order to share some particular information with other regime partners. It should be reminded that Canada’s anti-money laundering regime was set up in 2000, and in 2001 the anti-terrorist financing mandate was added.

The International Monetary Fund (IMF) has published 6 reports that were the result of the evaluations held by the Fund in March and May 2010. These were evaluations on Guernsey’s financial supervision and criminal justice frameworks that concerned anti-money laundering and counter-terrorist financing in the jurisdiction.

In accordance with the reports, Guernsey has financial sector regulation and supervision of a high standard across all sectors. These reports take into consideration Guernsey’s well-positioned basis for an effective Anti-Money Laundering/Combating the Financing of Terrorism regime, with preventative measures in line with the Financial Action Task Force (FATF) Recommendations.

As part of the IMF’s global Financial Stability Assessment Program, the evaluations were produced that assessed the jurisdiction as having a high level of compliance with the international standards. The standards were as follows:
-    the 25 Basel Core Principles for Effective Banking Supervision;
-    -the 28 Insurance Core Principles of the International Association of Insurance Supervisors;
-    the FATF 40 Recommendations on money laundering and 9 Special Recommendations on terrorist financing.

The 6 reports have been welcomed by the Guernsey government and the Financial Services Commission.

Guernsey’s Chief Minister Lyndon Trott said: “The regulatory framework and the Bailiwick’s anti-money laundering and combating the financing of terrorism regime that is now in place have been important factors in both sustaining Guernsey’s economy and developing and maintaining Guernsey’s international reputation as an excellent place to do business. This in turn has been an important driver in the continuing development of Guernsey’s international identity.”

It is worth mentioning that the reports also re-assessed the work of the Financial Investigation Unit (GBA/Police), the Law Officers Chambers and all the member organisations of the AML/CFT Advisory Committee, and reported the achievement of high international standards.

In October 2010, the Financial Action Task Force (FATF) published a report entitled Money Laundering Using New Payment Methods.

This report builds on the 2006 Typologies report on New Payment Methods (NPMs). It should be noted that there has been a significant increase in the number of transactions and the volume of funds moving through new payment methods (NPMs) since 2006. As a result, the number of discovered cases where such payment systems were misused for money laundering (ML) and/or terrorist financing (TF) purposes has gone up.

The report that can be downloaded from the FATF website compares the “potential risks” described in the 2006 report to the “actual risks” based on new case studies and typologies. A number of indicators of suspicious activity are described in the paper to help new payment methods service providers and other financial institutions to detect money laundering/terrorist financing activities. The FATF document describes the challenges faced by national legislators and regulators in these terms.

The Money Laundering Using New Payment Methods report was the result of analysis of questionnaire responses and publications about NPMs. Also, relevant private sector representatives such as NPM service providers (including the Internet payment sector, the mobile payment sector and prepaid card technology providers) made a significant input.

The 9th meeting of Eastern and Southern Africa’s Regional Intelligence Liaison Office (RILO) has been hosted by Seychelles. The 3-day event was aimed at seeking and sharing information regarding tax evasion, drug smuggling, using of forged currency, distribution of pornographic materials, and intellectual property rights violation.

RILO is a global information exchange network among Customs around the world. It manages data on illegal activities related to customs matters and works under the WCO (World Customs Organization) frame. The Regional Intelligence Liaison Officehas 18 member countries and is part of the World Customs Organisation. These are Angola, Botswana, Ethiopia, Kenya, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Rwanda, Seychelles, South Africa, Swaziland, Tanzania, Uganda, Zambia and Zimbabwe.