About a-team Marketing Services
The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

IMS Responds to Government’s Money Laundering Consultation

Subscribe to our newsletter

The IMS Group (IMS), the compliance and regulation consultant, has today responded to the Government’s consultation on reviewing Money Laundering Regulations 2007. The consultation period closes on 30 August 2011.

The Government’s proposals are intended to give businesses greater confidence to focus compliance on their highest risk areas and to discourage the tick-box approach taken by some businesses.

Peter Moore, head of regulation & compliance at IMS, says: “One aspect of the review looks at de-criminalising procedural failings. Currently there are criminal sanctions for those who do not have the appropriate systems and controls to combat money laundering. However, offences have not been widely prosecuted. We believe that the legal and regulatory requirements that empower and encourage firms to achieve a prescribed objective, rather than make them fearful of not doing so, are more likely to succeed. We therefore support proposals to decriminalise certain criminal offences in the Money Laundering Regulations.

“It was a shame to see that the Consultation did not cover staff training. Many firms engage with service providers for anti-money laundering training, with much being a computer-based approach. This periodic anti-money laundering technique can, on occasions, represent tick-box compliance at its worse, making it ineffective. We hope to see this addressed going forward.

“Much has been made in the Consultation of the perceived failure of firms relying on checks performed by other firms. It stresses that these provisions are there to simplify the obligations on the customer and firms party to a transaction. This should be reconciled with the FSA’s approach who, in addition, advocates that firms employ sample testing on other firms. We encourage HM Treasury to engage with the FSA to clarify this point.

“Regulatory responsibility will always fall back to an individual firm, whether or not they have relied on another regulated firm. Therefore, it is in that firm’s interests to perform customer due diligence themselves rather than rely on the assurance of another firm. We believe that a true risk-based approach should allow a firm to determine what risk is faced by reliance on another firm.”

Subscribe to our newsletter

Related content

WEBINAR

Recorded Webinar: The future of KYC and AML: How to tackle the challenges and gain the opportunities of perpetual KYC

Perpetual Know Your Customer (or pKYC) could be a game changer for client onboarding, due diligence and financial crime compliance. Moving on from today’s reactive approach that conducts client KYC processes at onboarding and typically at one, three and five year intervals, pKYC takes a proactive approach, creating a digital KYC profile and dynamically refreshing...

BLOG

SmartSearch Releases High-Risk Country Report Service in Response to Sanctions Against Russia

SmartSearch, an anti-money laundering (AML) specialist, has released a high-risk country report service in response to the introduction of sanctions against Russia. The service enables regulated businesses to scan existing clients and check for residency or citizenship in Russia, Belarus, or any other high-risk countries. The reporting tool instantly checks all clients that the regulated business has...

EVENT

TradingTech Summit London

Now in its 11th year the TradingTech Summit London brings together the European trading technology capital markets industry, to explore how trading firms are innovating in today’s cloud and digital based environment to create flexible, scalable trading platforms to support speed to market and business agility.

GUIDE

ESG Data Handbook 2022

The ESG landscape is changing faster than anyone could have imagined even five years ago. With tens of trillions of dollars expected to have been committed to sustainable assets by the end of the decade, it’s never been more important for financial institutions of all sizes to stay abreast of changes in the ESG data...