In this news update Comsure wishes to offer some updates on anti-money laundering and counter-terrorist financing news, both in the UK and internationally, covering the period from October 2017 to February 2018.

This period had seen a lot of activity.

1. The EU legislative bodies reached a political agreement on the Fifth Money Laundering Directive,
2. the UK Government published the Anti-Corruption Strategy,
3. HM Treasury published the results of the National Risk Assessment,
4. the JMLSG issued its updated AML/CFT guidance and
5. a new supervisory body, the Office for Professional Body Anti-Money Laundering Supervision, was established.

Highlights from this month’s issue include:

1.ESAs publish draft RTS on the group-wide management of money laundering and terrorist financing risk under MLD4.

1. The Joint Committee of the European Supervisory Authorities (ESA) published a final report on draft regulatory technical standards designed to strengthen group-wide management of money laundering and terrorist financing risks under the MLD4.

2. Revised JMLSG guidance on AML and CTF published

1. The Joint Money Laundering Steering Group (JMLSG), which consists of UK financial services trade associations, published the revised versions of its anti-money laundering and counter-terrorist financing guidance.
2. Although the guidance does not bind firms, compliance can provide a “safe harbour” in the event of prosecution once HM Treasury approves the guidance.

3. The launch of the Office for Professional Body Anti-Money Laundering Supervision

1. The UK Treasury launched the Office for Professional Body Anti-Money Laundering Supervision (OPBAS), which will work with all the UK’s AML supervisors to help improve standards and strengthen cooperation with law enforcement. The establishment of OPBAS was a key part of the Government’s 2016 Action plan for AML and CTF.

4. FCA fine for failings in market abuse controls and suspicious transaction reporting

1. The FCA imposed a fine of £1,049,412 on Interactive Brokers (UK), an online broker that arranges and executes transactions in certain financial instruments.
2. The FCA identified some failings in the firm’s market abuse controls and suspicious transaction reporting during the period between February 2014 to February 2015.
3. According to the FCA, these failings amounted to a breach of Principle 3 (management and control) and SUP 15.10.2 R (suspicious transaction reporting).

5. National Risk Assessment 2017 published by HM Treasury

1. HM Treasury published a national risk assessment of the money laundering and terrorist financing risks in the UK in 2017.
2. The risk assessment aims to identify the key risks to money laundering by sector and propose remedial steps to reduce these risks
3. It covered a range of topics including the money laundering and terrorist financing threats, financial technology and high-value dealers.

6. FCA speech on artificial intelligence in AML processes

1. The head of the FCA’s financial crime department, Rob Gruppetta, gave a speech on the use of artificial intelligence in firms’ anti-money laundering AML processes.
2. Mr Gruppetta noted that machine learning and AI could help to reduce the costs faced by banks in combatting financial crime, but also highlighted the risks of artificial intelligence-driven solutions.

7. HM Government publishes Anti-Corruption Strategy 2017-22

1. The UK Government published its Anti-Corruption Strategy 2017-2022 aiming to establish an ambitious and long-term framework for tackling corruption and to build on the UK’s 2014 “Anti-Corruption Plan”.
2. The Strategy covers areas ranging from bribery and corruption, money laundering, law enforcement, and guides both UK and overseas public and private sector entities.

8. European Parliament Committee adopts a report on new EU-wide measures on money laundering

1. The Civil Liberties Committee of the European Parliament adopted its report on a draft Directive designed to tackle money laundering and narrow the scope of organised crime in the EU.
2. In the draft Directive, Members of the European Parliament seek to introduce definitions of money laundering-related crimes that would be used across the EU and add a range of penalties for those convicted of money laundering.