WTR AND MLD IV
The Council of the EU has adopted the Wire Transfer Regulation (WTR) and the Money Laundering Directive IV (MLD IV). The WTR and MLD IV aim to prevent money laundering and terrorist financing. The approval is accompanied by a note which outlines the reservations of France, the Czech Republic and Austria to the WTR and MLD IV. The European Parliament has subsequently voted to adopt MLD IV and WTR. The package of legislation is due to be published in the Official Journal of the European Union (OJ) in June or July 2015. Member states will have two years to transpose MLD IV
FCA BUSINESS PLAN 2015/16 – FOCUS ON SYSTEMS AND CONTROLS IN RELATION TO FINANCIAL CRIME
The FCA has identified firms' systems and controls in relation to financial crime as a new area of forward looking focus in its 2015/16 Business Plan. The FCA will work with the PRA and the Financial Stability Board (FSB) as well as regulators in other countries in order to analyse and take action to address concerns relating to financial crime. The FCA has indicated that AML (including counter-terrorist financing and sanctions) and ABC will be particular areas of interest.
HMT ANTI-MONEY LAUNDERING AND COUNTER TERRORIST FINANCE SUPERVISION REPORT
HM Treasury has published its anti-money laundering and counter terrorist finance (AML/CFT) supervision report for 2013-14. The report provides a number of case studies of good practice by individual supervisors as they seek to meet the challenges set by the new Financial Action Task Force (FATF) methodology of assessing countries' AML/CFT regimes.
SFO FINED £180,000 FOR DATA BREACH
The Information Commissioner's Office has fined the SFO £180,000 after confidential documents gathered as part of a long-running corruption investigation were mistakenly sent to the wrong person as part of a process of the SFO returning evidence after the case concluded. The documents reportedly contained evidence relating to 64 people and were wrongly sent to a witness in the case. The ICO found that the SFO only began an investigation of the error following a parliamentary question on the subject and that the information returned to the witness had been prepared by a temporary worker who had received minimal training and had no direct supervisor.
ALSTOM TO FACE FURTHER CRIMINAL CHARGES
The SFO has brought further charges against Alstom Network UK Ltd and an Alstom employee (a former business development director) as part of its ongoing investigation. Alstom has been charged with a further two offences of corruption contrary to section 1 of the Prevention of Corruption Act 1906, as well as two offences of conspiracy to corrupt contrary to section 1 of the Criminal Law Act 1977. The first hearing in this case will take place on 12 May 2015. In a more recent development, the SFO also charged an individual who was formerly a director of Alstom International Limited and Senior Vice President of Ethics and Compliance. He is the sixth individual to be charged as part of this investigation.
CREATOR OF PONZI SCHEME PLEADS GUILTY
The creator of a Ponzi scheme that resulted in millions of pounds of losses for investors has pleaded guilty to five fraud related offences following a joint investigation by the SFO and Hampshire Police. David Gerald Dixon created the scheme through two companies known as Arboretum Sports (USA) Incorporated and Arboretum Sports (UK) Limited. Through those companies, collectively referred to as 'Arboretum Sports', victims were induced into placing money into what they were told was a no-risk gambling syndicate with the potential for dramatic rates of return. In reality, the scheme was a vehicle for Mr Dixon to appropriate the funds of its members. Mr Dixon will be sentenced on 22 April 2015.
JE-YOON SHIN SPEECH ON FATF AGENDA AND PRIORITIES
Je-Yoon Shin, Vice-President of the Financial Action Task Force (FATF), delivered a speech on 10 March 2015 on current FATF agenda and priorities, including the global regulatory arena, the risk-based approach, de-risking, the FATF’s mutual evaluation process and the FATF action on terrorist finance.
IRAN SANCTIONS - PROPOSALS ANNOUNCED FOR RELAXATION OF US AND EU RESTRICTIONS
On April 2, 2015 representatives from the US, EU and Iran announced that, following extensive negotiations, the "P5+1" (China, France, Germany, Russia, the UK and the US) and Iran had agreed parameters (the "Parameters") for a joint comprehensive plan of action regarding Iran's nuclear program (the "JCPOA"). Whilst the final provisions of the JCPOA have yet to be agreed, the Parameters set out the framework around which the JCPOA will be drafted between now and June 30 and include the provision for significant relaxations of UN, US and EU sanctions currently in force against Iran. Our full briefing is available here.
EU AMENDS GUIDANCE ON RESTRICTIVE MEASURES (SANCTIONS)
The Council of the EU has published a revised version of the EU Best Practices for the effective implementation of restrictive measures. Our briefing on the amended EU guidance on restrictive measures is available here.
RUSSIAN PARTIES AND SANCTIONS RELATED ARBITRATIONS
The Global Arbitration Review has published an article by one of our Moscow based partners, Alexei Panich, on Russian parties and sanctions related arbitrations. The article considers potential remedies for Russian parties in arbitrations involving sanctions arising from the Ukraine crisis and the approach of the Russian courts in relation to such matters. The full article is available here.
FCA WEBPAGE ON DERISKING
The FCA has published a webpage outlining its expectations with regard to banks' management of money-laundering risk. The FCA remarks: "While the decision to accept or maintain a business relationship is ultimately a commercial one for the bank, we think that there should be relatively few cases where it is necessary to decline business relationships solely because of anti-money laundering requirements. As a result, we now consider during our AML work whether firms’ derisking strategies give rise to consumer protection and/or competition issues".