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How are ‘money laundering’, ‘terrorism financing’ and ‘fraud’ legally defined in your jurisdiction?
‘Money laundering’ is defined by reference to a number of offences, as outlined in the next section. In general terms, money laundering covers all activities relating to the proceeds of criminal conduct.
‘Terrorism financing’ is not expressly defined in the British Virgin Islands. However, according to the International Convention for the Suppression of the Financing of Terrorism 1999, the definition and primary objective of ‘terrorism’ is “to intimidate a population, or to compel a Government or an international organisation to do or abstain from doing any act”.
‘Fraud’ is defined under the Criminal Code as:
- obtaining a pecuniary advantage by deception (Section 219); or
- dishonestly dealing, concealing or falsifying any account or record or document made or required for an accounting or other purpose (Section 221).
In addition, fraud may mean that theft has been committed. Under Section 203 of the Criminal Code, ‘theft’ is defined as the dishonest appropriation of property belonging to another with the intent of permanently depriving the other. Further, common law offences, such as conspiracy to defraud, may also be triggered. These laws are largely determined by English common law, the seminal authority being Scott v Metropolitan Police Commissioner ( AC 819).
Principal and secondary offences
What are the principal and secondary offences in relation to money laundering, terrorism financing and fraud?
Under the Proceeds of Criminal Conduct Act 1997 and the Drug Trafficking Offences Act 1992, the key money laundering offences are:
- assisting another to retain a benefit of criminal conduct;
- acquiring, possessing or using the proceeds of criminal conduct;
- concealing or transferring the proceeds of criminal conduct;
- failing to report a suspicion of money laundering; and
- prejudicing an ongoing investigation into money laundering (ie, tipping off).
Relevant businesses – such as credit institutions, financial institutions and professional firms – are subject to numerous heightened anti-money laundering (AML) obligations. These are principally set out in the Anti-money Laundering and Terrorist Financing Code of Practice 2008 and the Anti-money Laundering Regulations 2008.
As far as terrorist financing is concerned, the key offences are set out in the Terrorism (United Nations Measures) (Overseas Territories) Order 2001. Under the order, it is an offence for any person to invite another to provide or receive funds with the intention of using them, or with the knowledge that they may be used, for the purpose of terrorism. This includes wilfully providing or making funds available – by any means, whether directly or indirectly – for the purposes of terrorism. Finally, it is an offence to fail to disclose knowledge or suspicions of terrorist financing to the authorities.
In terms of fraud, the key offences are those set out in in the preceding section.
How are predicate offences defined?
Predicate offences are those set out in the preceding section in relation to the Proceeds of Criminal Conduct Act and the Drug Trafficking Offences Act. The British Virgin Islands has adopted an ‘all crimes’ approach to predicate offences under its AML and terrorist financing regime (although foreign crimes which are not crimes in the British Virgin Islands are excluded).
De minimis rules
What de minimis rules apply to money laundering, terrorism financing and fraud offences?
No de minimis rules apply to money laundering, terrorism financing and fraud offences in the British Virgin Islands.
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