In one of our earlier items under this section we reproduced an article written by one of our Directors on Money Laundering and the Proceeds of Crime Act.
At the time of writing that article it was anticipated that the revised money laundering regulations would be placed before parliament in June for implementation in September. This did not happen and in fact the regulations were not finalised in time to be put to parliament before it rose for its summer recess. This means that, at least as far as the accountancy profession is concerned, the new rules are now unlikely to come into force until next year.
Although this part of the new Money Laundering Regulations has been delayed one very important section is now in place and because of this businesses may unwittingly find they are breaking the law. This section will target businesses that are “dealers in high value goods” such as car dealerships, travel agents, jewellers and any other business, which is willing in principle, to accept cash payments of 15,000 euros or more that is around £10,000.
Any business failing to adhere to the Regulations could face up to two years imprisonment and/or a fine.
The first step for any firm is to decide whether it is willing in principle to accept cash payments of 15,000 euros or more. If the answer is “yes”, then it must register with Customs & Excise. Failure to register will be an offence.
As well as registering, businesses will need to maintain systems and controls similar to those currently used by banks and other financial institutions. Anyone trying to open a bank or building society account will know exactly what this means. Imagine a used car dealer doing a similar check when he tries to sell a car for cash!
To comply with the regulations businesses will need to appoint a money laundering reporting officer to take responsibility for all aspects of the money laundering regulations; introduce procedures to ensure the business knows the identify of any customer using cash, maintain copies of identification documents and records relating to the transactions and train staff on the legal requirements of the EU Directive and how to recognise suspicious transactions.
It is obvious that many businesses caught up within these regulations are likely to have little or no practical experience of complying with similar regulations or the methods used by money launderers. But, as mentioned earlier, businesses do need to be aware that the penalties for failing to comply are severe not to mention the reputation damage suffered as a result of being seen not to take the issue seriously.
Remember these regulations are in place and if they affect you you need to do something about it NOW.
If you would like further information on this or on any other matter why not get in touch with us via the contact section of this website.
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