Anti-money laundering and counter-terrorist financing
The current rules designed to combat money laundering (AML) and terrorist financing (CTF) in the EU are set out in the 3rd Anti-Money Laundering Directive (2005/60/EC) (3AMLD). Its provisions were transposed into the UK legislation during 2006 and 2007 by way of amendments made to the Proceeds of Crime Act 2002 and the introduction of the Money Laundering Regulations 2007. It must be remembered that the UK has chosen to make its AML laws go further than the requirements of 3AMLD and in doing so has rejected such elements as the de minimis level designed to avoid the need to report activity of limited value to law enforcement.
The UK is a member of the Financial Action Task Force (FATF) which sets the worldwide standards to combat money laundering and terrorist financing. Indeed, the 4AMLD was adopted to, inter alia, incorporate the revised 2012 FATF Recommendations.
In June 2015, the EU agreed the 4th Anti-Money Laundering Directive (2015/849) (4AMLD) which must be transposed into Member States’ national legislation by June 2017.
Following the terrorist attacks in Paris and Brussels, the EU published an Action Plan to combat terrorist financing. Parts of that plan envisage revising certain aspects of the 4AMLD in areas such as high-risk third countries, virtual currencies, prepaid instruments and cooperation between the Financial Intelligence Units. Proposals to bring into force that part of the EU Action Plan (in the form of an amending directive to 4AMLD) were put forward by the Commission in July 2016.
Following the Panama Papers leaks, the European Parliament set up an inquiry committee to investigate related allegations of money laundering, tax evasion and tax avoidance.
The activities of the Brussels Office have focused on monitoring the developments in the field of AML / CTF and on bringing the solicitors’ expertise and experience into the policy process. Together with our members from England and Wales, Scotland and Northern Ireland we have engaged with the relevant EU and UK policy makers, as well as other bars and law societies. We continue to monitor the work of the Panama Papers inquiry committee (PANA).