Archive for January, 2008

Anti-Money Laundering measures to be taken in Japan from March 1

Thursday, January 31st, 2008

On January 29, 2008, Japanese government officials decided that real estate agencies, credit card companies, jewelry dealers and firms in some other industries will be obliged to take anti-money laundering measures. The new regulation takes effect from March 1, 2008.
In accordance with the anti-money laundering law, the above-mentioned companies will be obliged to confirm customers’ identities, keep transaction records and file reports on suspicious cases. It should be noted that financial institutions are already required to take these measures. Regarding confirming the identities of customers, this is required from the firms in cases of concluding credit card contracts, land and building transactions, the sale of jewelry or precious metal items worth more than 2 million yen. According to an ordinance, records of such transactions must be kept for 7 years.

The following documents will be required to be submitted by individuals for verifying their identities: copies of driver’s licenses, health insurance certificates or residency registration certificates. Corporations will have to present company registration certificates.

Fin CEN publishes Suggestions for Addressing Common Errors Noted in Suspicious Activity Reporting

Sunday, January 27th, 2008

On October 10, 2007, the Financial Crimes Enforcement Network (FinCEN), is a US network bringing people and information together in order to fight money laundering, published a document called Suggestions for Addressing Common Errors Noted in Suspicious Activity Reporting.

The document was aimed to discuss some common errors in the filing of Suspicious Activity Reports (“SARs”) noticed by FinCEN. It enlists and provides an explanation of 10 of the most common errors. The documen also discusses ways the errors can be mitigated.

The target audience for whom the document was published is financial institutions in different industries wishing  to implement simple strategies for providing accurate and complete information in their SAR filings. Also it should be useful for SAR filers trained on the requirements that could achieve significant improvements to the SAR filing without many additional efforts. 

The published Suggestions for Addressing Common Errors Noted in Suspicious Activity Reporting are important as, accurate complete SARs are an effective tool in fighting money laundering.

AML Masterclass offered by Universiteit Maastricht Business School with ACAMS

Wednesday, January 23rd, 2008

AML Masterclass offered by Universiteit Maastricht Business School with ACAMS

It is not a secret that efficient anti-money laundering training in Europe is urgently needed, which to a great extent is conditioned by the recent implementation of the 3rd EU Money Laundering Directive. Due to  implementation deadline for the 3rd EU Money Laundering Directive in December, European companies had to  to speed on anti-money laundering issues and best practices quickly.

To help the situation, the Universiteit Maastricht Business School in the Netherlands will offer an 8-day Masterclass for compliance officers, auditors and other anti-money laundering professionals. To develop the Masterclass, the Universiteit Maastricht Business School has teamed with the Association of Certified Anti-Money Laundering Specialists (ACAMS).

The Masterclass  will be held in 2 seminars of 4 days each.

The 1st session of the Masterclass presented in conjunction with ACAMS will take place on January 25. The session will focus on money laundering in the insurance industry.

The Masterclass aims at creating a greater awareness of money laundering in order to provide knowledge that helps combat this topical modern problem. At the end of the course, a final examination is to be passed.

Venezuela asks US and EU to remove FARC and ELN from terrorist blacklists

Saturday, January 19th, 2008

In his annual State of the Nation address to the congress, the President of Venezuela, Hugo Chavez Frias asked that the Revolutionary Armed Forces of Colombia (FARC) and the National Liberation Army (ELN) be removed from United States and European Union terrorist blacklists.

According to Chavez, these designated terrorist organisations are true armies, not terrorists. Both FARC and ELN are respected in Venezuela, and the global community should recognise them.

The response of the United States and the European Union has not followed yet. It is not known whether it is to follow at all. Some consider that the request reveals state-sponsored terrorism. However, this is an arguable issue. Another question is the following – if de facto recognition of both organisations occurs, will that place Venezuela’s banks and non-bank financial institutions at risk when they conduct business for them?

Reserve Bank of Zimbabwe warns banks about money-laundering

Tuesday, January 15th, 2008

In the beginning of January 2008, the Reserve Bank of Zimbabwe (RBZ) has directed banks to adhere to Zimbabwe’s anti-money laundering laws as well as to report any suspicious transactions. Some of the banks directed by the RBZ were found to have been working with “cash barons”.

RBZ Governor Dr Gideon Gono said that banks must respect the anti-money laundering laws and adhere to the guidelines provided by the central bank regarding this problem. According to him, the message and advice to the financial sector is numerous circulars and guidelines issued by the RBZ as regards money-laundering and other undesirable banking practices.

Gono informed that, in accordance with investigations, some bank officials were releasing billions of USD to cash barons while ordinary depositors were suffering. There also were cases, when bank employees reactivated dormant accounts to use them afterwards as channels to syphon money. Gono said that some bank employees have lost their jobs recently as investigations established their involvement in cash deals from which they would get kickbacks.

The central bank of Zimbabwe urged the business community, labour and the general banking public to avoid any illicit cash transactions.

ADB to help SBP in fighting money laundering

Friday, January 11th, 2008

Asian Development Bank (ADB) will provide assistance to State Bank of Pakistan (SBP)Â in order to strengthen the anti-money laundering regime. This will include effective consolidation of anti-money laundering and combating financing of terrorism monitoring and analytical measures within a single unit.

To effectively fight and prevent money laundering and terrorist financing, it is planned to set up a Financial Management Unit in the State Bank of Pakistan.

Qualified consulting firm to be appointed is required to provide the experts (like Anti-Money Laundering Expert, Forensic Accounting Expert, Financial Intelligence Unit Database Expert, Law Enforcement and Legal Expert, Securities and Banking Expert) to establish the Financial Monitoring Unit in the SBP in accordance with the new Anti-Money Laundering Law.

The ADB will provide a technical assistance cluster to the Government of Pakistan for a value of USD 11.5 million for “Support to Governance Reforms in Pakistan.”

Canada and Anti-Money Laundering

Monday, January 7th, 2008

An insight into anti-money laundering is provided by A Preventive Guide for Small Business & Currency Exchanges in Canada published by the Royal Canadian Mounted Police, which is the Canadian national police service and an agency of the Ministry of Public Safety Canada.

The Guide indicates that one of the roles of the RCMP within Canada’s Initiative to combat money laundering is informing the public. Therefore it describes money laundering as something that can happen anywhere, anytime, and one may not even be aware of having been involved in it.

While defining money laundering is clear and similar to what has been repeatedly discussed previously, some issues related to money laundering discussed in the Preventive Guide have not been discussed yet. For example, the Guide provides a term “willful blindness” as a situation when a person who has become aware of the need for some inquiry does not make the inquiry as he/she does not wish to know the truth and prefers to remain ignorant. There is also an example of willful blindness in the Guide. It is as follows: “A salesperson encounters a customer who wants to buy a consumer good or service with $25,000 cash. The customer produces a gym bag containing $25,000 in $20 and $50 bills. In the vast majority of modern Canadian commerce, this is not a normal business transaction, and this method of payment is highly unusual. Though the salesperson instantly suspects something is out of the ordinary, they chose to ignore their suspicion so as not to jeopardize an easy sale.”

Australia and Money Laundering

Thursday, January 3rd, 2008

The Government of Australia has introduced new laws in the Anti-Money Laundering and Counter-Terrorism Financing Act 2006. It is important that it has implemented new anti-money laundering and counter-terrorism financing laws in order to meet international standards as well as to protect businesses from the risk to be exploited for money laundering and terrorism financing.

Physical persons in Australia should be aware of the fact that from December 12, 2007 the new laws started to affect customers of many service providers. These service providers include banks, building societies, lending, leasing and hire purchase companies, credit unions, asset management companies, foreign exchange dealers, stored value card issuers, issuers of traveller’s cheques, remittance dealers, life insurers, financial planners, superannuation funds, custodial service companies, cash couriers and securities dealers, the gambling sector (casinos, internet and electronic gaming service providers, bookmakers, clubs and pubs, TABs, and bullion dealers).

Many customers might be affected by the new laws when opening an account with a financial institution, transferring funds electronically, undertaking a large gambling cash transaction, etc. When conducting a transaction in Australia, a customer may be required to provide different forms of identification that depend on the risk level of the transaction. The Australian Government requires just a driver’s licence for a low risk transaction, while more customer information might be required for a higher risk transaction.

More detailed information on the new rules that have been in force since December 12, 2007 can be found on the website of the Australian Government.