The EU’s Fourth Anti-Money Laundering Directive is now in force for all member states, as of 26 June.
Under the new regime, corporates and other legal entities will have to maintain accurate and current information on their beneficial ownership. They must share this information on a central register, which will be accessible to banks, law firms and “any person or organisation that can demonstrate a legitimate interest”.
The threshold for customer due diligence (CDD) requirements has changed: CDD is required by anyone trading goods in cash with a value of more than €10,000 (down from the current level of €15,000). Also, CDD must be conducted by casinos where customers wish to place a stake or collect winnings of at least €2,000.
The rules regarding politically exposed persons (PEPs)—individuals whose prominent position in public life may make them vulnerable to corruption—are no longer limited to persons outside the member state: local PEPs will now be subject to the same scrutiny as foreign PEPs (although the Directive urges firms not to refuse to form a business relationship with a person simply because s/he is a PEP).
Firms are expected to put in place policies, procedures, systems and controls to mitigate and manage the risks of terrorist financing and money laundering. Measures required will depend on the size of the firm but will cover risk-management practices, reporting, record-keeping, internal controls, employee screening of employees; and compliance management.