The Fourth Anti-Money Laundering Directive (2015/849/EU) (the “Directive”) came into force on 25 June 2015 and repeals and replaces the Third Anti-Money Laundering Directive. Member states have until 26 June 2017 to implement the changes within domestic
The changes brought in by the Directive place a wider personal responsibility and liability on all professionals.
The Directive addresses the risk-based approach to customer due diligence, requiring more effort for greater risk customers. Legal professionals will need to continue to ascertain the levels of risk presented and adapt their procedures accordingly.
Companies will be required to identify individuals with ultimate beneficial ownership and to maintain an ownership register, to be held in a specified location which provides certain authorities and institutions with unlimited access.
The definition of a Politically Exposed Person (“PEP”) is expanded within the Directive to include domestic and foreign PEPs. This applies to heads of state, members of government, members of parliament and the judiciary, as well as directors of state-owned
The trigger threshold for anti-money laundering procedures is lowered to €7,500, with individual member states able to set even lower thresholds depending on risk perception levels. Additionally, the rules relating to disclosing payments in excess of €7,500
which previously related solely to casinos are expanded to include the entire gambling sector.
Furthermore, the Directive requires national authorities to co-operate on cross-border cases.
The Directive interplays with the Serious Crime Act 2015 so that legal professionals who fall foul of the Directive could be found to have unwittingly facilitated organised crime. The minimum fine for breaches is €1,000,000, but where credit or financial institutions
are involved, the minimum fine increases to €5,000,000.
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