Record keeping, disclosure and compliance

Record-keeping and disclosure requirements

What record-keeping and disclosure requirements apply to companies and relevant individuals under the anti-money laundering, terrorism financing and fraud legislation?

The Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 sets out record-keeping and disclosure requirements.

Designated persons under the legislation are obliged to keep records which evidence the procedures applied, and information obtained, in performing customer due diligence. Records which evidence the history of services and transactions carried out in relation to each of the designated person’s customers must also be kept. Under the 2010 act, designated persons are subject to a five-year record retention obligation.

In terms of disclosure requirements, there is a legislative duty placed on designated persons by the 2010 act to report suspicious transactions. A designated person who knows, suspects or has reasonable grounds to suspect that a person is engaged in money laundering or terrorist financing must make a report to the Garda Síochána and the revenue commissioners (a Suspicious Transaction Report).

The Suspicious Transaction Report must include:

  • the information on which the designated person’s knowledge, suspicion or reasonable grounds are based;
  • the identity, if the designated person knows it, of the relevant person suspected to be involved in the money laundering or terrorist financing; and
  • the whereabouts, if known, of the property the subject of the money laundering, or the funds the subject of the terrorist financing, as the case may be.

The designated person is obliged to make the report as soon as possible.

Compliance

What internal compliance measures are required and/or advised for companies in relation to the anti-money laundering, terrorism financing and fraud legislation?

The 2010 act requires a designated person to have policies and procedures in place aimed at preventing and detecting the commission of money laundering and terrorist financing. The policies and procedures should state how the designated person:

  • assesses and manages the risks of money laundering or terrorist financing; and
  • sets internal controls, including internal reporting procedures for the purposes of reporting suspicious transactions. 

Furthermore, the designated person should adopt policies and procedures relating to the monitoring and management of compliance with the policies and procedures referred to above.

Staff should be made aware of the requirements under the 2010 act, and appropriate training in the above policies and procedures should be provided. In particular, anti-money laundering or counter-terrorist finance training should involve training on how staff report suspicious transactions, both internally and to the relevant authorities.

The Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Bill 2018, once enacted, will introduce further requirements to have in place anti-money laundering or counter-terrorist financing polices, controls and procedures and, importantly, to keep them up to date.

What customer and business partner due diligence is required and/or advised for companies in relation to the anti-money laundering, terrorism financing and fraud legislation?

Customer due diligence (Section 33, 2010 act) must be conducted to identify and verify customers or business partners and, if necessary, their beneficial owners. This may be done through the use of documents or information which the designated person has reasonable grounds to believe can be relied upon to confirm the identity of the customer or business partner.

In certain circumstances enhanced customer due diligence will be necessary (Section 37, 2010 act). Enhanced due diligence is required where a customer, or a beneficial owner who is connected with the customer, is a “politically exposed person”, an immediate family member or a close associate of a “politically exposed person”. Enhanced due diligence will involve, among other things, the approval from the designated person’s senior management before a business relationship is established or continued with the customer.

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