Rob Gruppetta spoke on the future of AML regulations. He spoke on:

  • the requirements of the fourth money laundering Directive (MLD4) and what it will mean for firms. He highlighted some controversial issues which Treasury’s forthcoming consultation on implementation will address, such as what MLD4 means by its requirement to “screen” employees and how UK laws will change to meet the MLD4 requirements on domestic Politically Exposed Persons (PEPs). He also highlighted the current consultations of the ESAs, and the importance of the finalised guidance at EU level being right, as national regulators will have to comply with it;
  • FCA’s proposal for its new data return on financial crime (see above), and how FCA hopes the information firms give it will help it meet its duties to prevent financial crime and to assess which firms it needs to monitor most closely;
  • the SMR and how the obligation to give a senior manager explicit responsibility for overseeing a firm’s efforts to tackle financial crime sits alongside the Money Laundering Reporting Officer (MLRO). He explained how the MLRO may also be the individual with overall responsibility for ensuring the firm meets its overall financial crime responsibilities, but need not be;
  • the problem of “derisking”, and how FCA needs to understand why banks are using AML measures as a reason to apply wholesale derisking;
  • innovation and use of technology in AML compliance;
  • international efforts; and
  • enforcement.

(Source: FCA Speaks on AML)