Money Laundering Regulations 4 / 8

Money Laundering Regulations

These should deter and detect Money Laundering and funding of Terrorism 

These regulations apply to all 'relevant persons' (banking and investment businesses, accountants and auditors, tax advisers, lawyers, estate agents and casinos) 

They include:

  1. Risk management practices

    The business should take a 'whole firm' approach to assessing the money laundering risks, including the risk of clients being involved in money laundering or terrorist financing. 

    The bigger and more complex the business the more risk management is needed

  2. Internal controls

    These should include:
    Appointing a Money Laundering Compliance Principal (MLCP) on the board 
    Appointing a nominated officer to receive internal reports of suspected money laundering and, where appropriate, to report them to the NCA.
    Assessing the skills, knowledge, conduct and integrity of employees 
    Establishing an independent audit function of anti-money laundering policies, controls and procedures.

  3. Customer due diligence
    This work includes, for example, identifying and independently verifying customers and their agents and monitoring the business relationship or transaction according to the level of risk of money laundering. (Simplified and enhanced)

    Simplified due diligence is permitted where there's a low risk of money laundering or terrorist financing. Due diligence work ghouls reflect the low risk level

    Enhanced due diligence measures are required when:
    A transaction or business relationship involves a person established in a ’high risk third country', or if they are, or if they are a 'politically exposed person' 

    Examples of enhanced due diligence measures include:

    Understanding the purpose of transactions.
    Increased monitoring 
    Obtaining additional independent, reliable verification of information provided by the customer.
    Ensure customer transactions are consistent with the nature of their business

  4. Reliance and record-keeping procedures

    Businesses should have written policies, aimed at preventing Money Laundering activities 

    Employee training on them must be maintained.

  5. Monitoring and management of compliance

    Businesses should continuously monitor their policies, controls and procedures and keep up to date

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