Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. •...
Transcript of Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. •...
![Page 1: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/1.jpg)
SUSAN NAUGHTON ACII ACOI
NOVEMBER 2016 CPD BLITZ
Building Awareness of Procedure & Practice to Recognise & Prevent Money Laundering
![Page 2: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/2.jpg)
AGENDA
Opening Questions
• What does an AML procedure look like ?
• Where would you find one ?
• What does STR stand for ?
• Who is the MLRO in your firm ?
• Money Laundering & Counter Terrorist Financing Explained
• What is FATF
• The Fourth Directive
• AML & The Central Bank
• Customer Due Diligence
• Questions
![Page 3: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/3.jpg)
MONEY LAUNDERING & TERRORIST FINANCING WHY IS IT SO IMPORTANT ?
• Statistics
• CRIMINALS LAUNDER ANYWHERE BETWEEN $500 BILLION AND $1 TRILLION WORLDWIDE EVERY YEAR.
• The Global Effect
• Social, Economic Security
• Criminal activity pays off.
• Fraud
• Corporate Embezzling
• Drugs & drug-related crime,
• Law-enforcement resources stretched
![Page 4: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/4.jpg)
WHO ELSE THE ACT APPLIES REGARDLESS OF REGULATORY STATUS,
• payment services as defined in Directive 2007/64/EC
• instruments, foreign exchange, futures and options, exchange rate instruments or transferable securities
• participating in securities issues
• advising on capital structure, or industrial strategy or advising on or providing services relating to mergers and the purchase of undertakings
• money broking
• portfolio management and advice
• safekeeping and administration of securities
• taking deposits
• lending
• leasing
• issuing or administering means of payment
• providing guarantees
• trading in moneysafe custody services
• issuing electronic money
• market
![Page 5: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/5.jpg)
AN INSIGHT INTO TERRORIST FINANCING
Short Video for insight
• Money Laundering
• Terrorist Financing
• What firms are required to Do
• What firms can do
![Page 6: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/6.jpg)
SOME MORE QUESTIONS
• Why do you think it is OK to show an American Money Laundering Video to an Irish audience ?
• How Much is Laundered Every Year ?
• How many Money laundering Directive are there
• How do they find their way into Irish law
• Do they matter ?
![Page 7: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/7.jpg)
![Page 8: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/8.jpg)
RECENT CENTRAL BANK INITIATIVES ?
![Page 9: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/9.jpg)
CBI WEBSITE
![Page 10: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/10.jpg)
LETTER TO THE ULSTER BANK
![Page 11: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/11.jpg)
INTERMEDIARY TIMES
Common Points
• Policies and procedures
• Adherence to procedures
• Proper Risk Assessment
• Training
• Reliance on Third Parties
• Previous Business
![Page 12: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/12.jpg)
![Page 13: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/13.jpg)
![Page 14: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/14.jpg)
![Page 15: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/15.jpg)
![Page 16: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/16.jpg)
![Page 17: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/17.jpg)
![Page 18: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/18.jpg)
![Page 19: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/19.jpg)
![Page 20: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/20.jpg)
![Page 21: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/21.jpg)
![Page 22: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/22.jpg)
![Page 23: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/23.jpg)
![Page 24: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/24.jpg)
![Page 25: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/25.jpg)
IN SUMMARY
• Procedures & Practices
• Client Identification
• Risk based Customer Due Diligence Measures
• Record Keeping
• Staff Training
• Reporting
![Page 26: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/26.jpg)
AML V 4MLD
• MLD 4 is designed to strengthen the EU’s defences against money laundering and terrorist financing.
• Risk-based approach,
• Beneficial Ownership,
• Scope of customer due diligence requirements,
• Politically exposed persons (“PEPs”),
• Reliance on third parties, enforcement,
![Page 27: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/27.jpg)
WHAT ABOUT ELECTRONIC TRANSFERS
How do we know where the money is coming from ?
June 2015,
The Wire Transfer Regulation sets out
• Minimum requirements essential to ensure the traceability of transfers of funds,
• Provisions to ensure consistency of approach between Member States
![Page 28: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/28.jpg)
LAW APPLICABLE AS AT NOV 2016
The Law
The Criminal Justice (Money Laundering and Terrorist Financing) Act 2010, as amended by Part 2 of the Criminal Justice Act 2013 (“the Act”).
• The Act transposes European Union Law on AML and CFT (the Third Money Laundering Directive (2005/60/EC) and its Implementing Directive (2006/70/EC)) into Irish Law.
![Page 29: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/29.jpg)
OBLIGATIONS UNDER THE ACT
• Implement appropriate policies and procedures to ensure compliance.
• Financial institutions must refer to the provisions of the Act to ascertain their statutory obligations.
• The Central Bank is responsible for effectively monitoring financial institutions’ compliance with their obligations by
![Page 30: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/30.jpg)
CENTRAL BANK REQUIREMENTS
• Training
• Policies and procedures
• Formal approach to AML/CFT risk assessment
• Customer due Diligence
• Management Information
• Keep Records
![Page 31: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/31.jpg)
![Page 32: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/32.jpg)
EVIDENCE IS REQUIRED
• AML/CFT Supervisory Strategy
• Onsite inspections key areas tested:
• Corporate Governance
• Customer Due Diligence
• Ongoing Monitoring
• Suspicious Transaction Reporting
• Training
![Page 33: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/33.jpg)
22.“FINANCIAL INSTITUTION” MEANS –
• (f)
‘’an insurance intermediary within the meaning of the Insurance Mediation Directive (other than a tied insurance intermediary within the meaning of that Directive) that provides life assurance or other investment related services, ‘’
![Page 34: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/34.jpg)
KNOW YOUR CLIENT
• ..aka Customer Due Diligence
Key provisions include:
Know Your Customer …
To identify and verify customers
Understand beneficial owners….. ….
Monitor dealings with a customer….
![Page 35: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/35.jpg)
WHEN DO THE CUSTOMER DUE DILIGENCE OBLIGATIONS OF THE ACT APPLY?
New Clients
• a) prior to establishing a business relationship with the customer;
• b) prior to carrying out an occasional transaction
The designated person does not have a business relationship with the customer, and
The total amount of money paid by the customer in a single transaction or series of transactions is greater than €15,000.]
![Page 36: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/36.jpg)
WHEN DO THE CUSTOMER DUE DILIGENCE OBLIGATIONS OFTHE ACT APPLY?
Existing Clients
Designated persons should monitor their dealings with existing customers,
Keep CDD information up to date as warranted by the overall knowledge the person has of
• the customer,
• the nature of the business relationship and
• the risk of money laundering or terrorist financing.
![Page 37: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/37.jpg)
TYPES OF DUE DILIGENCE
• Simplified Customer Due Diligence
• Customer Due Diligence
• Enhanced Customer Due Diligence
![Page 38: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/38.jpg)
RECORD A SUSPICIOUS TRANSACTION
Report Suspicious Transactions
• Revenue
• Gardaí
![Page 39: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/39.jpg)
REMINDER- WHY IS IT IMPORTANT
Sources of Illicit Funds
• Prostitution
• Counterfeit Goods
• Drug trafficking
• Tobacco & Fuel
• Human trafficking
• Property crimes
• Tax evasion3
Consequences
![Page 40: Anti Money Laundering - Brokers Ireland · against money laundering and terrorist financing. • Risk-based approach, • Beneficial Ownership, • Scope of customer due diligence](https://reader033.fdocuments.net/reader033/viewer/2022042211/5eb2b4fc622d0f15ac6f08fa/html5/thumbnails/40.jpg)
QUIZ