The 2010 Act overhauled this area of law and introduced new anti-money laundering requirements for credit and financial institutions and other “designated persons,” requiring them to carry out certain due diligence measures in relation to customers. For example, designated persons are required to request identification documentation from customers, to monitor transactions and to report suspicious matters to the relevant authorities. The Draft Bill seeks to deal with certain matters that have come to light following the enactment of the 2010 Act. In addition, the final report of the Mahon Tribunal also recommended the introduction of a series of enhanced due diligence measures and the Government has stated that it will include some of these measures in a more detailed draft of the Bill this Autumn.
Changes introduced by the Draft Bill include:
The definition of “occasional transaction” is amended to include wire transfers of funds of €1,000 or more. Due diligence measures will, therefore, apply to the beneficial owners of such funds. In addition, the monetary threshold for private members gaming clubs will be reduced from €15,000 to €2,000. Currently, Section 104 of the 2010 Act requires a copy of the Register of such clubs to be made available for inspection at the Department of Justice. This is amended by the Draft Bill which requires that the Register be made available to the public in an electronic form.
Section 31 of the 2010 Act permits the Minister for Justice to designate a place other than a Member State if the Minister is satisfied that such a place imposes requirements equivalent to those specified in the Third Money Laundering Directive. The Draft Bill amends Section 31 of the 2010 Act and states that such designations cannot be relied upon by designated persons unless the firm carries out its own due diligence exercise to determine the risks of money laundering in that jurisdiction.
Sections 35 of the 2010 Act will be amended to clarify that designated persons must monitor both the source of wealth and source of funds. Section 54 of the 2010 Act will be amended to require firms to keep documentation relating to the due diligence purpose up-to-date and to future-proof procedures to account for new technological developments. This will also allow for the appointment of a compliance / money laundering reporting officer by designated persons. Section 55 of the 2010 Act will be amended so that designated persons are no longer required to physically retain such records in the state.
The Draft Bill requires that senior management approval be obtained when an existing customer becomes a politically exposed person residing outside the State and that enhanced monitoring must be undertaken in such circumstances. In addition, where a firm believes that a particular relationship presents a higher risk of money laundering, the Draft Bill requires that enhanced due diligence measures be applied.
It is an offence under the Draft Bill to provide false or misleading information or documentation for the purposes of consumer due diligence. Furthermore, the Draft Bill will also allow the Gardaí to obtain search warrants to allow them to investigate cases of suspected money laundering.
Please click here to read the full text of the Draft Bill.