Home Knowledge Anti-Money Laundering Watch 2012

Anti-Money Laundering Watch 2012

In June 2012, the Irish Government published the general scheme of a proposed bill to amend the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010.  The changes aim to refine Ireland’s existing anti-money laundering (“AML”) regime in light of the last two years’ experience and to reflect the Financial Action Task Force’s recommendations.

The proposals are at the early stages of the legislative process and relevant industry sectors will be consulted before more detailed amendments are drafted.  Given the AML regime’s significant impact on the financial-services industry, companies that are designated persons should monitor the proposals’ progress and, where possible, engage in the process.

The Government’s key proposed amendments include the following:

  • Senior management approval will be necessary where an existing customer residing outside of Ireland becomes: (a) a politically exposed person (“PEP”) or; (b) a close family member or associate of a PEP. Where approval cannot be given due to a failure on the part of the customer to provide information then the designated person must discontinue the business relationship and not provide any services for so long as the failure continues
  • Designated persons will not be able to rely on designations by the Minister of Justice naming non-EU countries as being AML equivalent unless the designated person has also carried out its own assessment of the risk of money laundering or terrorist financing in that place
  • Designated persons will be obliged to apply enhanced due diligence where a customer, beneficial owner or transaction present a heightened risk of money laundering or terrorist financing
  • Designated persons will have to appoint a member of their senior management as money laundering reporting officer.  While this is not currently required under the AML regime, companies should note that under the Fitness and Probity regime the Central Bank of Ireland has designated this position as a pre-approval controlled function
  • Providing false or misleading information for the purposes of customer due diligence will be an offence which may be tried summarily or on indictment

Contributed by:  Eoin Caulfield and Gillian Young