i-law

Money Laundering Bulletin

Starling Bank fined £29m in UK over high-risk customer and sanctions control breaches

Digital challenger Starling Bank must pay a UK£28,959,426 (US$38,448,705) penalty after it failed to comply with the terms of a voluntary requirement (VREQ) agreed with the UK Financial Conduct Authority (FCA) not to take on high and higher ML risk customers until it had fixed its AML model, and for sanctions screening deficiencies.
Online Published Date:  02 October 2024
Appeared in issue:  318 - 01 November 2024

Workaround - Myanmar money flows

The generals may be losing their grip on power in Myanmar but widespread concern over the authorities' ability to surveil opponents via the banking system has contributed to a growth in alternative remittance, all against a backdrop of strictures on international payments that accompany blacklisting by the Financial Action Task Force. Poppy James& Keith Nuthall look into how the money keeps moving.
Online Published Date:  03 October 2024
Appeared in issue:  318 - 01 November 2024

UK government issues information-sharing guidance

In response to anxiety among UK businesses regulated for anti-money laundering that sharing information on customers to prevent economic crime could breach data protection rules, the UK government legislated - in the Economic Crime and Corporate Transparency Act 2023, effective 15 January 2024 - to disapply civil liability in such circumstances, and has now followed up with practical guidance.
Online Published Date:  04 October 2024
Appeared in issue:  318 - 01 November 2024

Taiwan tracks up

Taiwan's sovereignty as the Republic of China may remain unrecognised by all but 12 countries, but it is a full member of the Asia/Pacific Group on Money Laundering (APG) and has been making significant progress on anti-money laundering/counter financing of terrorism, finds Keith Nuthall.
Online Published Date:  08 October 2024
Appeared in issue:  318 - 01 November 2024

Kuwait technical compliance undercut by weak effectiveness - FATF

The latest Financial Action Task Force (FATF) mutual evaluation of Kuwait, published 8 October, finds the Gulf state has "basic" understanding of money laundering risk, at national level, and "low" appreciation of terrorist financing risk.
Online Published Date:  08 October 2024
Appeared in issue:  318 - 01 November 2024

Two out of three: Andorra, San Marino, Monaco and EU AML

Small but fiercely independent, Andorra, San Marino and Monaco are working on how closely they might align their anti-money laundering regimes with the European Union model, with marked differences in the progress, as Andreia Nogueira, Brenda Dionisi and Keith Nuthalldiscover.
Online Published Date:  09 October 2024
Appeared in issue:  318 - 01 November 2024

EU lays ground for Russia sanctions over 'hybrid' civil disorder attacks

The European Union (EU) has widened activities that can spark EU sanctions to include so-called 'hybrid' threats, such as undermining electoral systems and hacking, which, it says, are employed by the Russian state and associated Russians.
Online Published Date:  09 October 2024
Appeared in issue:  318 - 01 November 2024

TD Bank fined US$3bn for BSA failings, pleads guilty to conspiracy to commit ML

TD Bank, the tenth largest lender by assets in the USA, pleaded guilty, on 10 October, to conspiring to fail to maintain an anti-money laundering program that complied with the Bank Secrecy Act (BSA); to not file accurate currency transaction reports (CTRs); and, a first for a US bank, to launder money. Ultimately owned by Canada's Toronto Dominion Group, the US financial institution will pay just over US$3.1 billion in criminal and civil penalties to US authorities.
Online Published Date:  11 October 2024
Appeared in issue:  318 - 01 November 2024

Total Disaster

"America's Most Convenient Bank" - TD Bank, NA's slogan - it most certainly was, for criminals, for almost a decade, from January 2014 to October 2023. Senior executives, including the Chief Anti-Money Laundering Officer and Bank Secrecy Act Officer, "knew there were long-term, pervasive, and systemic deficiencies" in the bank's AML policies, procedures and controls, but let them pass, in pursuit of a "flat cost paradigm" of profit maximization. Neither is named in the US Department of Justice Information, released on 10 October, but will they be charged?
Online Published Date:  14 October 2024
Appeared in issue:  318 - 01 November 2024

Long haul - Australia's regulation of non-financials

Not before time Australia appears on the verge of passing legislation that would bring lawyers, accountants, trust and company service providers, real estate agents and others, including in the cryptocurrency sector, within scope of the anti-money laundering regime. Keith Nuthalllooks at the proposed measures and road to implementation.
Online Published Date:  14 October 2024
Appeared in issue:  318 - 01 November 2024

FATF releases rules for fifth mutual evaluation round

FATF has released its detailed rules on how its fifth mutual evaluation round will proceed, with assessments beginning next year and continuing until 2032.
Online Published Date:  18 October 2024
Appeared in issue:  319 - 01 December 2024

Untold wealth - Brunei

The concentration of power in the hands of one man in Brunei is undisputed but how much he is worth and how those assets are held is not. Paul Cochrane & Keith Nuthallseek the road to riches.
Online Published Date:  18 October 2024
Appeared in issue:  319 - 01 December 2024

Lawfare - the case against mandatory AML

While lawyers in Europe long ago accepted they should be under a legal duty to manage client money laundering risk, their counterparts in other leading jurisdictions - the United States, Canada and till recently Australia (though legislation is not yet passed) - have fought vigorously against imposition of similar obligations. Keith Nuthalllooks into their rationale and whether it can hold.
Online Published Date:  18 October 2024
Appeared in issue:  319 - 01 December 2024

Effective direction - interview with Elisa de Anda Madrazo, FATF President [Video]

The Financial Action Task Force is set on a course of 'radical tuning' across the next two years, with a drive to ensure the risk-based approach - Recommendation 1 - properly informs application of its global standards against illicit finance, and, among other priorities, to expand financial inclusion, improving access to the formal financial system while reducing reliance on cash; also to better respond to non-compliance by some, often the smaller, low-capacity jurisdictions.Elisa de Anda Madrazo, of Mexico, who took on leadership of FATF for the next two years in July, generously made time to explore the programme with Keith Nuthall, ahead of the October 2024 plenary.
Online Published Date:  21 October 2024
Appeared in issue:  319 - 01 December 2024

Keep 'em out: digital defence

In a continual effort to break into the financial system, criminals will test any innovation to the limit so are fully exploiting AI, deepfakes and falsified biometrics to open and operate accounts. Paul Cochrane looks into the dynamic threat and how the banking sector is also harnessing the latest developments in technology to respond.
Online Published Date:  21 October 2024
Appeared in issue:  319 - 01 December 2024

Lake Elsinore Casino fined US$900,000 by FinCEN over BSA/AML failings

California, USA-based Lake Elsinore Hotel and Casino, on 23 October, agreed to a consent order from FinCEN under which it will pay a civil penalty of US$850,000 for major gaps in its Bank Secrecy Act/anti-money laundering controls, between 7 September 2014 and 11 February 2019. A further US$50,000 charge will apply if the firm fails, within a year, to report to FinCEN on how it is progressing remediation recommended by a qualified independent consultant.
Online Published Date:  23 October 2024
Appeared in issue:  319 - 01 December 2024

FATF plenary launches fifth evaluation round with financial inclusivity push

The first Financial Action Task Force (FATF) plenary under the presidency of Mexico's Elisa de Anda Madrazo has launched the anti-money laundering body's fifth mutual evaluation round, while taking initial steps towards boosting inclusivity.For the first time, two external jurisdictions - Cayman Islands and Senegal - were invited to participate in the plenary and working groups as guests, to "broaden the diversity of perspectives at the FATF," said a post-meeting communiqué.
Online Published Date:  28 October 2024
Appeared in issue:  319 - 01 December 2024

Decipher - China's crypto strategy

China has taken a hard line on cryptocurrency activity, in sharp contrast to Hong Kong, but it goes on even as Beijing forges ahead with plans for a digital Yuan. Keith Nuthall & Andreia Nogueirapuzzle the evolving regulatory response.
Online Published Date:  29 October 2024
Appeared in issue:  319 - 01 December 2024

A drop in the ocean: UK v ML

The furtive nature of money laundering makes it difficult to determine just how common it is or the true amount of funds it involves, reflects Niall Hearty of Rahman Ravelli. So, the figures that the UK's National Economic Crime Centre (NECC) produced make interesting and alarming reading.
Online Published Date:  29 October 2024
Appeared in issue:  319 - 01 December 2024

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