Useful resources

Central Bank of Ireland 

The Central Bank has a role in the regulation and supervision of anti-money laundering and countering the financing  of terrorism in Ireland. Under the CJA 2010 (as amended) it is the competent authority in Ireland for the monitoring and supervision of financial and credit institutions' compliance with their AML/CFT obligations. The Central Bank is empowered to take measures that are reasonably necessary to ensure that credit and financial institutions comply with the provisions of the the CJA 2010 (as amended). Their website gives an overview of and provides an explanation of both what money laundering and terrorist financing is.

The Central Bank has, under AML regulations which came into effect in 2020, and the Investment Limited Partnerships (Amendment) Act 2020 been designated the Registrar with responsibility for maintaining the Central Register of Beneficial Ownership of certain ''Applicable Financial Vehicles''. The entities which must register are Irish Collective Asset-Management Vehicles, Unit Trusts, Credit Unions, Investment Limited Partnerships and Common Contractual Funds. Click here for an informative article on beneficial ownership registers  in Accountancy Ireland April 2021.

In 2019 the Central Bank published its Anti-Money Laundering and Countering the Financing of Terrorism Guidelines for the Financial Sector. It was updated in June 2021. While readers are cautioned that the guidelines set out the expectations of the Central Bank in respect of credit and financial institutions' compliance with their AML/CFT obligations as set out in the 2010 Act, the guidelines provide useful reference material. They  incorporate expectations set out in previous Central Bank AML/CFT Sectoral Reports, AML/CFT Bulletins, and relevant European Supervisory Authority Guidelines.

Department of Justice (DOJ) and Department of Finance

Under the legislation the Minister for Justice and Equality is designated as a Competent Authority for the purposes of securing compliance by certain categories of ‘designated persons’ with statutory requirements to prevent money laundering or terrorist financing.

The DOJ has established an Anti-Money Laundering Compliance Unit (AMLCU) to administer the functions of the competent authority under the CJA 2010 (as amended). Read here for further information on the compliance unit. High value goods dealers are “designated persons” under the remit of the Department of Justice. Also, authorisation from the Minister for Justice and Equality is required for Private Members Clubs  and certain  Trust or Company Service Providers to operate. Click here for the latest anti money laundering reports from the AMLCU which provides an account of the activities that the unit has carried out in performing its functions under the legislation  during the year to which the annual report relates.

In late 2020 the Hamilton Review Group made its recommendations to combat economic crime to the Minister for Justice. Following the publication the Minister said there would be  a new cross-government plan to tackle economic crime and corruption. The Department of justice action plan 2021 published in March 2021 refers to the DOJ beginning  to implement, in collaboration with other agencies, plans to tackle economic crime and corruption, following the publication of the Hamilton review. It contains plans for example to establish the Advisory Council recommended in the review.

The Department of Finance is a member of the Anti-Money Laundering Steering Committee (AMLSC), which was set up in 2003. It was established to facilitate the collaboration and coordination between national competent authorities, government departments and law enforcement authorities, to ensure the effective combatting of money laundering and terrorist financing.

In 2019 the Department of Finance and the Department of Justice and Equality published Ireland's first Money Laundering and Terrorist Financing (ML/TF) National Risk Assessment (NRA). It is an assessment of the ML/TF threats in Ireland and the vulnerabilities of certain sectors to being used for ML/TF as a result of the products and/or services they offer, their customer base, the countries in which they operate and the delivery/distributions channels they utilise.

In the report the accountancy services sector is given a medium-high final risk rating. The report states that the specialist nature of the knowledge and services provided by the accountancy service providers makes them vulnerable to being sought out and exploited by those who seek to launder the proceeds of crime or evade tax. The report also recognises that the risks are mitigated by the supervision of accountancy regulatory bodies. However it notes that this mitigating factor is not present for all accountancy services providers and therefore the sectoral risk assessment is judged to be Medium-High on the basis of the nature of the services provided, the scale of the sector and the low level of STR reporting from the sector.

UNITED KINGDOM 

National Crime Agency

The National Crime Agency (NCA) is a non-ministerial government department, the role of which is to protect the public from the most serious threats resulting from organised crime .It  publishes an annual plan which sets out how it will meet its strategic and operational priorities in the year ahead. Click the link for the Annual Plan 2021- 2022.It also has recently published its  Annual Plan 2022-23.Read here the strategic priorities for the Agency and you can download a copy of the 2022-2023 plan here.

The NCA also publishes an annual report summarising its performance against that plan. Click the link for the Annual Report and Accounts 2020-21.  

Click here for some useful information from the NCA on suspicious activity reports. The most important documents  on the NCA website are the Glossary Codes – here we give a link to the latest version of Suspicious Activity Report (SAR) Glossary Codes and Reporting Routes (March 2022) but is really important to note that every few months these are updated and the firms must use the latest version when submitting a SAR so please check back to their website for any updates.

The Director General has independent operational direction and control over the NCA's activities.  The Director General is accountable for the agency's performance to the Home Secretary and through them to Parliament.

Click the following link for NCA money laundering and illicit finance pages.

The NCA publishes a bulletin called SARs in Action .You can access it by going to this page and searching in the description box by title . Click here to access the March 2022 edition and here for the SARs in action July 2022 edition .Articles in the July edition  include one on professional money launderers and one on UKFIU cryptocurrency engagement which involves proactive interaction with the cryptocurrency sector, working closely with the sector to help improve SARs quality. The publication also contains SARs case studies. 

Office for Professional Body AML Supervision (OPBAS)

OPBAS is the oversight body for Professional Body Supervisors such as Chartered Accountants Ireland in relation to anti-money laundering. Follow the link to OPBAS webpages to learn about OPBAS and its work.

HM Revenue & Customs

HMRC has  guidance on its pages “Help and support for money laundering supervision”. There are a series of webinars  on money laundering supervision containing information for all businesses and sectors including Accountancy Service Providers and Trust or company service providers registered with HMRC .

HM Treasury

HMT published its national risk assessment of money laundering and terrorist financing in 2020. In this report the risk of money laundering through Accountancy Service Providers (ASPs) is  rated high . The report states that accountancy services remain attractive to criminals due to the ability to use them to help their funds gain legitimacy and respectability, as implied by ASPs’ professionally qualified status. Those providing accountancy services remain at risk of being exploited or abused by criminals, especially if ASPs become complacent in their regulatory obligations under legislation , or willingly facilitate money laundering. The accountancy services considered most at risk of exploitation continue to be company formation and termination, mainstream accounting and payroll. The report also states that HM Treasury continues to judge that accountancy services are not attractive for terrorist financing, and there remains no evidence of these services being abused by terrorists. There are a couple of useful AML case studies detailed in this report.

Please also  see here for the first UK national risk assessment of proliferation financing  published in September 2021 by HM Treasury. Proliferation Financing (PF) is financing for the malicious use of chemical, biological, radiological and nuclear materials and weapons. The publication notes that awareness of PF risk in the Designated Non-Financial Businesses and Professions (DNFBPs) sector is, in general, low in most countries, which could represent a particular risk to the UK, notably in relation to trust and company service providers given the ease of establishing companies in the UK.

Other
Readers may be interested in the UK House of Commons research briefing entitled “Corporate criminal liability in England and Wales” published in February 2022. It discusses the circumstances in which corporates can commit crimes in England and Wales and sets out recent developments and reform and the future of corporate criminal liability.

See also the publication of April 2022 from the House of Commons library in the UK ,a research briefing entitled “Economic crime in the UK: A multi-billion pound problem”. It deals with the scale of the problem of economic crime, government action, and current issues including Brexit.

The Consultative Committee of Accountancy Bodies (CCAB) is an umbrella group of chartered professional bodies in the UK of which Chartered Accountants Ireland is a member. In July 2022 CCAB published a number of helpful client due diligence case studies.

Case study 1 -High Risk jurisdiction

Case Study 2 – Varying CDD based on level of risk

Case Study 3 – Change in client circumstances

Case Study 4 – An offer that’s too good to refuse

You can click here to access them.

The case studies provide different scenarios and consider certain questions in each such as what were the red flags to pick up? What are the risks and the potential threats the firm faces or may face? What action(s) should be or should have been taken?

EUROPEAN

European Union (EU)

Click to access  the webpage of the European Commission on anti-money laundering and counter terrorist financing. The European Commission has prepared a useful diagram  on “preventing money laundering and terrorist financing across the EU- How does it work in practice?"

The EU has developed a solid regulatory framework for preventing and combatting money laundering and terrorist financing, substantiated by case law of the EU Court of Justice. Recent developments in legislation have aimed to strengthen the EU anti-money laundering and countering the financing of terrorism (AML/CFT) framework. These include amendments to the 4th Anti-Money Laundering Directive (4AMLD) introduced by the 5th Anti-Money Laundering Directive (5AMLD).

Recent Irish legislation, the CJA 2021  continues the Republic of Ireland’s programme of compliance with the provisions of the EU directives.See above under "Central Bank" heading for an article on beneficial ownership in April 21 Accountancy Ireland. Follow the link to a news item on CJA 2021 and new beneficial ownership of trust regulations 2021.

Regulations were brought into force in Ireland in Feb 2022 to establish a central database of information on safe deposit boxes and payment accounts as required under the fourth and fifth Anti-Money Laundering Directives. They are the European Union (Anti-Money Laundering: Central Mechanism for Information on Safe-Deposit Boxes and Bank and Payment Accounts) Regulations 2022.These regulations authorise the Central Bank of Ireland to establish and maintain a central register of information on safe-deposit boxes and bank and payment accounts. FIU Ireland will be able to access the above information. It will also be allowed to share it with other financial intelligence units across the EU but the information will not be available to the wider public.   The Central Bank has not yet confirmed the likely timing for the establishment of the central database or the central mechanism. 

The EU commission is mandated to identify high risk third countries having strategic deficiencies in their regime on anti-money laundering and counter terrorist financing. The aim is to protect the integrity of the EU financial system. The EU list of high-risk third countries provides a key tool for obliged entities and public authorities .Details are periodically available on the EC commission website. Please click here for an article dated December 2022  on anti-money laundering where it is reported that  the Commission updated its list of high-risk third-country jurisdictions to strengthen the international fight against financial crime.

On 7 May 2020, the European Commission adopted an action plan for a comprehensive Union policy on preventing money laundering and terrorism financing built on six pillars. Click here for the text of the action plan. Points to note are the proposals for interconnection of central bank account registries (which registries are required under AMLD5) , a more detailed and harmonised single rule book, an EU level supervisor and an integrated supervisory system. The Irish Central Bank’s Director General, Financial Conduct spoke at a   international fraud prevention conference  in April 2021. Her remarks included her view that the development of a single rulebook by means of a directly applicable Regulation will result in greater consistency and deliver much needed regulatory clarity to, and a level playing field for, businesses that operate across the Union and the establishment of a single European AML/CFT Supervisor will deliver a consistent application of the rules and eliminate gaps that can be exploited by criminals. 

In July 2021 the European Commission presented a package of legislative proposals to strengthen the EU's anti-money laundering and countering terrorism financing (AML/CFT) rules. The package also includes the proposal for the creation of a new EU authority to fight money laundering.

There are four legislative proposals:

a regulation establishing a new EU AML/CFT Authority;

a regulation on AML/CFT, containing directly applicable rules, including in the areas of customer due diligence and beneficial ownership;

A sixth Directive on AML/CFT (“AMLD6”) to replace the existing Directives and containing provisions that will be transposed into national law, such as rules on national supervisors and Financial Intelligence Units in Member States;

A revision of the 2015 Regulation on Transfers of Funds to trace transfers of crypto-assets.

Click here for details of the package on the European Commission website.

Please click here to access an interesting article by A&L Goodbody solicitors on the subject published in March 2022.

The European Supervisory Authorities (EBA, European Insurance and Occupational Pensions Authority (EIOPA) and European Securities and Markets Authority (ESMA)) published a joint report in May 2022 , which provides a comprehensive analysis on the completeness, adequacy and uniformity of the applicable laws and practices on the withdrawal of licence for serious breaches of the rules on anti-money laundering and countering the financing of terrorism (AML/CFT).

The joint report advocates for the introduction in all relevant EU sectors of a specific legal ground to revoke licences for serious breaches of AML/CFT rules. The joint report also seeks inclusion of assessments by competent authorities of the adequacy of the arrangements and processes to ensure AML/CFT compliance as one condition for granting authorisation or registration. It also  says that for this purpose, cooperation and information exchange between prudential supervisors and AML/CFT supervisors should be ensured. You can read the joint report on the withdrawal of authorisation for serious breaches of AML/CFT rules here.

INTERNATIONAL

Financial Action Task Force

The Financial Action Task Force (FATF) is an independent intergovernmental organisation established by the G-7 in 1989 in response to mounting concern over money laundering .The United Kingdom is a member since 1990. Ireland joined in 1991. FATF leads the international fight against money laundering and terrorist financing, setting international standards and promoting the effective implementation of legal, regulatory and operational measures for combatting money laundering, terrorist financing and other related threats to the integrity of the international financial system. See for example its publication in March 2021 (with EGMONT group) of Trade-Based Money Laundering Risk Indicators which  will help public and private sector identify possible trade-based money laundering.

The FATF has developed a series of recommendations that are recognised as the international standard for combating money laundering and the financing of terrorism and proliferation of weapons of mass destruction. The recommendations are regularly revised to ensure that they remain up to date and relevant, and they are intended to be of universal application. The Irish Minister for Finance at the Select Committee on Justice on 19 Nov 2020 made reference to the use of FATF recommendations in drafting Irish legislation relating to the creation of a  registration and supervision regime for AML purposes of Virtual Asset Service Providers. This is now contained in the Criminal Justice (Money Laundering and Terrorist Financing ) (Amendment ) Act 2021.

The FATF monitors the progress of its members and the most recent Mutual Evaluation Report (MER) on Ireland, was published in September 2017. An executive summary of the report is also available. In February 2022 FATF  issued its “Follow up Report -Ireland 2022” on Anti-money laundering and counter-terrorist financing measures in Ireland. Since its 2017 FATF assessment and 2019 follow up, Ireland has taken a number of actions to strengthen its framework. To reflect its progress, the FATF has now re-rated Ireland on DNFBPs (Designated Non-Financial Businesses and Professions): Customer due diligence, from partially compliant, to largely compliant. Also, as Ireland has met many of the new requirements introduced for Virtual Asset Service Providers with only minor deficiencies remaining it has retained its rating as remaining largely compliant in this area. You can read the full report here.

The  2018 UK Assessment can be downloaded here.

FATF publishes annual reports. Click the link to its Annual Report 2020-2021   where FATF outlines its  achievements under the first year of its German Presidency including the publication of two reports analysing the opportunities and challenges of new technologies, a report into money laundering from environmental crime, which concluded that most countries are failing to assess this area as part of national or money laundering risk assessments and a report on ethnically or racially motivated terrorist financing.

The Organisation for Economic Co-operation and Development

The Organisation for Economic Co-operation and Development (OECD) is an international policy shaping organisation . It works with governments, policy makers and citizens, to establish international standards and solutions to a range of social, economic and environmental challenges. Ireland and the United Kingdom are members.

Click the link for the OECD report which  evaluates Ireland’s Criminal Justice (Corruption Offences) Act 2018, which came into force in July 2018. Click here to read the OECD report detailing  the United Kingdom's achievements and challenges in respect to implementation and enforcement of the OECD Anti-Bribery Convention.

The OECD has also produced the useful publication Money Laundering and Terrorist Financing Awareness Handbook for Tax Examiners and Tax Auditors which is a practical tool to assist tax authorities in identifying money laundering during the course of normal tax audits. The handbook published in 2009 and updated in 2019 includes updated money laundering indicators and new material to increase detection and reporting of terrorist financing.

These pages are provided as resources and information only and nothing in these pages purports to provide professional advice or definitive legal interpretation(s) or opinion(s) on the applicable legislation or legal or other matters referred to in the pages. If the reader is in doubt on any matter in this complex area further legal or other advice must be obtained. While every reasonable care has been taken by the Institute in the preparation of these pages, we do not guarantee the accuracy or veracity of any resource, guidance, information or opinion, or the appropriateness, suitability or applicability of any practice or procedure contained therein. The Institute is not responsible for any errors or omissions or for the results obtained from the use of the resources or information contained in these pages.