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Finance Focus
Alison Matthews Alison Matthews Consulting Ltd
Tel: +44 (0)7803 398146
Email: alm@alisonmatthewsconsulting.co.uk Web: www.alisonmatthewsconsulting.co.uk
Anti-Money Laundering, uk
“The key is to know your business and your business sector. Think about the work you do, the types of clients you have, the countries you deal with, your internal structures and the experience and
expertise of your staff.” lison Matthews is renowned as one of the UK’s leading experts on money laundering and professional conduct for solicitors. She has built an excellent reputation as a respected and trusted
compliance expert with an encyclopaedic knowledge of the relevant laws and regulations within the field.
A Q
What more can you tell us about your company and your professional background?
Alison Matthews Consulting Ltd. provides training and compliance services, which are practical and commercial to help businesses ensure their systems are effective and their employees understand their obligations, spot potential money laundering and talk to the MLRO.
I have advised on anti money laundering (AML) for 20 years, having been an MLRO for 10 years in a top 20 law firm after 12 years in Professional Ethics at the Law Society. I chaired the Law Society’s Money Laundering Taskforce, contributed to the Second and Third EU Money Laundering Directives and sat on the Government’s Money Laundering Advisory Committee and SOCA’s SARs Regime Committee.
I lecture for all the UK Law Societies and the Isle of Man Law Society as well as Central Law Training and regularly contribute to various legal publications.
Q
What regulations surround money laundering in the UK?
The Money Laundering Regulations 2007 currently apply but new regulations are expected during 2015 to implement the Fourth EU Money Laundering Directive. There may also be changes to the Proceeds of Crime Act
2002 (POCA). Regulated businesses will assess what changes will be required once the new Regulations are available.
Q
How has the AML landscape changed in recent years?
At UK level, we have seen the introduction of the National Crime Agency (NCA) which is a high profile agency incorporating a National Cyber Crime Unit. The NCA has recently issued revised guidance on submitting a SAR and on obtaining consent under POCA.
The FCA replaced the FSA, bringing an increased focus on the importance of systems and controls, emphasised by the scale of fines imposed on various major banks.
The Financial Action Task Force (FATF) issued revised recommendations in February 2012, which form the basis of the Fourth Directive. The Directive was issued in February 2013 and the final text should be adopted in late 2014. The consultation on the draft Regulations is expected in late 2014/early 2015 with implementation in late 2015.
Q
How can a business assess their risk of exposure to money laundering activities?
The key is to know your business and your business sector. Think about the work you do, the types of clients you have, the countries you deal with, your internal structures and the experience and expertise of your staff. Clients may be politically exposed or on the sanctions list or certain countries are higher risk because they are on the FATF list. Consider the guidance from your regulator. Having identified your risks, you will manage and mitigate them by implementing effective systems and controls.
Q
How can a business manage the risks of being involved in money laundering?
Robust systems and controls together with regular practical/effective training for employees will help a business to manage the risks. However, unless there is clear leadership and commitment from senior management, with a good compliance culture, the systems will not be effective.
Know your client, not only by obtaining basic customer identification/verification but also by understanding the purpose and intended nature of the business relationship. Ongoing monitoring of the client’s risk profile, the transactions and the source of funds should result in employees raising concerns with the MLRO.
Q Q
How should a business respond if they discover they have unwittingly become caught up in money laundering?
The MLRO will assess all the information and decide whether a report to NCA should be made. Following the judgement in Shah v HSBC [2012] EWHC 1283 (QB)], the decision must be made by the MLRO who will carefully consider the law, including the defences, taking legal advice if necessary.
Is there anything else you would like to add?
Not only do we face the prospect of revised Regulations in 2015 but the UK will be subject to a Mutual Evaluation Review by FATF in spring 2016 which will assess the effectiveness of our AML regime. Reviewing the effectiveness of your systems and controls and providing practical training now will help to protect your business and your staff.