New Money Laundering regulations edge closer
The UK government has again confirmed that it will adopt the EU Fifth Anti-Money Laundering Directive (5AMLD), enacted earlier this year. Lord Henley, a Parliamentary Under-Secretary of State at the Department for Business, Energy and Industrial Strategy, noted in a private letter to Margaret Hodge MP that the January 2020 deadline for transposition of the directive falls within the implementation period of Britain’s exit from the UK. HM Treasury is planning consultations in winter 2018/19 and spring 2019.
The Law Commission’s recent report also highlighted proposed changes to the money laundering regime by suggesting a greater focus is needed on high risk events. The Commission said that the UK’s current money laundering regime puts too high a load on criminal investigators, is overly onerous for financial institutions, and risks severe financial loss to businesses and individuals who are the subject of suspicious activity reports (SARs). It is proposing new statutory guidance to reduce the large number of low-quality SARs, by focusing on accounts where there are reasonable grounds to suspect property is criminal property; and to allow banks to respond to a SAR by locking only the suspected criminal funds into an account, while leaving the rest of the account open to trade. It also suggests that commercial organisations rather than employees should be liable for failure to prevent a criminal offence when an employee fails to disclose a suspicion.
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