Danish Gambling Operator Reports Tipwin to the Police for AML Failings

Then danish gambling operator Spillemyndigheden has reported Tipwin to the police for violating the Danish Money Laundering act

According to the sources, Spillemyndigheden, the government office based in Odense, Denmark, has reported to the police that the business has failed to create risk assessments of retail bets with a lack of written policies on its retail offerings. 

It is also worth mentioning that the operator also lacks complete business procedures and controls for the offerings based on land or in regards to money laundering until 25 May 2022.

In the official statement of the regulator to the police, it stated all the shortcomings of Tipwin in compliance with the anti-money laundering standards. It stated: “Spillemyndigheden notes that the rules on risk assessment, policies and business procedures are absolutely fundamental in the Money Laundering Act. By failing to prepare a risk assessment, Tipwin has not had a useful tool that has provided an overview and understanding of where and to what extent Tipwin is exposed to money laundering or terrorist financing, and what measures are in place are necessary to mitigate the risks involved.”

This clearly states that the german based gambling operator, Tipwin is exposed to the illicit crimes of money laundering and terrorist financing and has failed to comply with the AML regulations. The Danish regulator also focused on the lack of preparation from the operator on assessments of risks which are fundamental components of the anti-money laundering act.

Spillemyndigheden also added: “Preparing a risk assessment of the company’s business model is a very fundamental means of limiting the risk of money laundering. Tipwin has thus also not had policies and operational procedures that stem from the risk assessment. By failing to prepare a risk assessment, the Gambling Authority has therefore handed over the case to the police investigation.”

The authority also launched an injunction on the breach of rules and procedures in regard to the online casino and betting operations. With the main emphasis on money laundering, the regulator released a statement last month which reminded businesses in the industry of the obligations. It mentioned the regulations most firms are complied with, which are in order to prohibit the financial interactions with individuals, groups, legal bodies or countries. 

In addition, Spillemyndigheden issued a 3 months deadline to Tipwin to sort out the situation.

Suggested Read: Danish Gaming Regulator Sanctions Unibet Over AML Violations


Britain’s FCA Fines Ghanaian Bank for Insufficient AML Regulations

The Financial Conduct Authority of the UK has imposed fines of £5.8 million on Ghana International Bank for poor Anti-Money Laundering controls 

The news agency of Nigeria reported about the fines which were imposed on the Ghanaian bank by the financial conduct authority (FCA) for not responding adequately to the laws of anti-money laundering controls. The FCA claimed the bank gave other lenders correspondent banking services, enabling them to offer goods and payment services they otherwise couldn’t.

It said that the bank did not effectively carry out the additional anti-money laundering inspections necessary between January 2012 and December 2016. It added: “No evidence of actual money laundering was detected, though the risk of money laundering as a result of these deficient systems was significant,” It further stated that the bank has failed to oppose the findings and has agreed with the settlements.

In the response, the GHIB (Ghana International Bank) said that during the process of investigation it has adopted a totally new board of management, which strengthened the anti-money laundering controls significantly. Chief Executive GHIB, Dean Adansi stated: “Under new leadership, GHIB is a fundamentally different bank today, with a healthy balance sheet and the support of its major shareholders,”

Both the bank and the FCA are in complete contradiction as the Britain authority has stated that GHIB failed to identify and assess the threats posed by its correspondent customers of other  financial institutions and properly scrutinise transactions worth £9.5 billion processed on their behalf.

The UK’s watchdog analyzed the Ghanain bank in December 2016 to assess its financial crime controls, the outcome of the assessment identified in the visit concluded that the bank voluntarily agreed not to take on new customers. The fine that has been imposed on the Ghana International Bank by the FCA is £5.8 million (7.1 million U.S. dollars) for failings in its anti-money laundering controls.

The FCA stated: “This restriction remains in place.’’, and the Ghanian bank continues to work with the financial authorities and independent experts to improve the financial crime controls for the future.

Suggested Read: FCA Unveils Three-Year Anti-Money Laundering Strategy to Curb Financial Crime

uk govt issue new guidance

UK Government Issues New Guidance On Data Collection Related To Self Custody Crypto Wallets

The government of the United Kingdom is issuing new rules on the collection of data for the crypto businesses that gather identifying information for self-custody wallets

The UK’s finance ministry is making new guidelines on when the business of digital currencies can gather the data of the user. The collection of identifying information regarding the self-custody wallets is addressed in the guidelines. 

After consulting extensively, the treasury of the United Kingdom stated that the businesses running crypto will now be required to gather self-custody wallet verification data only for the transactions, specifically suspected of illicit activities. 

The statement of the UK officials mentioned: “Instead of requiring the collection of beneficiary and originator information for all unhosted wallet transfers, crypto-asset businesses will only be expected to collect this information for transactions identified as posing an elevated risk of illicit finance.”

The consultation consisted of several respondents who exercised the included supervisors based on the anti-money laundering and counter-terrorist financing groups in the United Kingdom. The members of the crypto assets sectors, civil industry, and society of academia also appeared in the official consultation. 

According to the government, the legislation will add the laws for the businesses dealing in crypto that will determine the suspicious transaction. The new guidance will take charge in the coming future, in September upon the official approval from the complete parliament. 

In the past, the United Kingdom made crypto firms gather data about the recipient of the investments and funds that are sent from all the self-custody wallets. As the result of increasing scams and digital frauds, the government is looking to tackle crypto-based transactions.

The government made its statements regarding the prevailing issue: “The government does not agree that unhosted wallet transactions should automatically be viewed as a higher risk; many persons who hold crypto assets for legitimate purposes use unhosted wallets due to their customizability and potential security advantages (e.g. cold wallet storage), and there is no good evidence that unhosted wallets present a disproportionate risk of being used in illicit finance.”.

The reports that came out earlier this year, also indicated that the UK government would release more regulations in terms of the crypto exchanges after completing the consultations with the associated firms and trading groups.

Suggested Read: Barclays Prohibits UK Clients from Sending Debit and Credit Payments to Binance

nsw govt introduce new laws

NSW Government Introduces New Money Laundering Laws To Combat Organised Crimes

The New South Wales government  add new laws to increase the security against the criminal gangs that launder money and perform other illicit activities

The NSW government is looking to add a new principle law in their regulations for properly confiscating unverified assets from various criminal gangs. The law will assist in banning the use of encryption devices as a part of long-awaited reforms. This step is taken as major compliance to counter the money laundering activities and organised crimes in the region.

The cabinet meeting was conducted on Wednesday that agreed on the new initiatives and measures which are specifically proposed to cripple the finances of multiple criminal networks. This will also help in restricting criminals from generating profits via these illicit networks that tend to anticipate them financially. 

The new measures will allow the reversal of unlawfully acquired wealth from major drug traffickers and will also help in the expansion of power to stop and search for huge amounts of laundered money. The senior ministers have been working on new measures to combat the causes of crime since last year when the top-ranked officer alerted the NSW authority about secret briefings which stated the crimes were out of control. 

After several days of the briefing, Premier Dominic Perrottet was presented with the same information from the senior government source. In the same month, the Attorney-General Mark Speakman and after which the minister of police, David Elliot started to work on laws for countering unexplained wealth. The measles continued under Paul Toole, the new Minister appointed for the Police.

Perrottet stated about the new laws will provide assistance to the police to help infiltrate the criminal networks. He said: “Organised crime is all about drug supply and money – and to truly shut it down we need to shut down the flow of dollars that fuels it,”

The police minister Paul Toole also stated about the new laws: “If you think you can hide the ill-gotten gains of crime, you are wrong. If you think you can avoid detection by using encrypted devices, you are wrong,”  He added to the use of encrypted devices: “These reforms will make it an offence to possess these kinds of devices and allow us to better target high-risk individuals from using them to orchestrate crime.”

The legislation will be introduced in the spring session meetings of the parliament.

Suggested Read: Australia Risks Damage To Economy Unless Money Laundering Laws Are Improved

client sues

Client Sues Credit Suisse for Losing $607 Million in Fraud Scheme

A Georgian billionaire, Bidzina Ivanishvili, has sued the Swiss bank, Credit Suisse over a Fraud scheme that caused the loss of over $607 million

Bidzina Ivanishvili has sued the Swiss bank over the case of fraud that was run by one of the ex-bankers at Credit Suisse. The scheme caused the billionaire to lose 607 million US dollars in the case. According to the new estimate of the losses, that’s nearly 10% higher than the previous figure that came out for Credit Suisse in the March ruling.

The news comes from the statements published by several media agencies on June 21. Credit Suisse already added in legal provisions, some of which are related to the Bermuda case. The new amount that was cited during the hearing on Tuesday was overseen by Bermuda Supreme Court chief justice Narinder Hargun. He directed the forensic accountants on both sides of the case to deliver a more accurate assessment of Bidzina Ivanishvili’s losses. The chief justice put the losses at $553 million 3 months ago.

At that time, Credit Sussie was criticised by the judge, he said that the Bank’s life insurance department had failed to monitor the convicted criminal Patrice Lescaudron. He mentioned that the unit turned a “blind eye” to all the wrongdoings of the fraudster. Lescaudron was convicted in 2018, and according to the bank authority, he was the only one responsible for all the illicit activities. 

Jonathan Crow, Credit Suisse Lawyer for Bermuda, stated in the hearing that he acknowledged the figure of $607 million and did not contradict the ruling of Narinder Hargun. Instead, the lawyer sought compensation. 

Bermuda passed legislation in 2000 for creating entities known as SAC (Segregated Account Companies). These firms allow for the legal split of assets and liabilities for the separation of accounts.

According to the statement of Crow: “We fought the action and we lost” and are not seeking to set aside the liability, but the compensation, “is to be met and met only from the assets in the segregated accounts” created for the client, Bidzina Ivanishvili. Credit Suisse Life (Bermuda) has already appealed the verdict. 

Suggested Read: FCA Declares Fine On Credit Suisse For Due Diligence Failings

china cntral bank

China’s Central Bank Fines ICBC & Bank of Chongqing for AML Shortcomings

Chinese banks including industrial and commercial banks of Chongqing have been fined by regulators for insufficient anti-money laundering controls.

The lenders fined more than 60 allegations on the banks of China, specifically in Chongqing the main reason for the inadequacy of the anti-money laundering controls in the financial dealings. The news comes from the Yicai Global, the media group in China, according to the reports the fines were imposed last weekend by various Chinese lenders.

The amount fined to the banking sector of China is CNY44.5 million (6.6 million USD) the last weekend, June 17th as per Yicai Global, these statistics might be incomplete for now. The other penalties for some individuals also exceeded the 1 million CNY (149,300 USD). 

The public revealed the information about the punishment of local banks last year, as per sources, the People’s Bank of China charged over 365 banks and financial institutions with a total amount of CNY 261 million (39 million USD). 

The latest violations from the banks and other financial departments of the country made the lenders impose charges on Chinese banks. The Chongqing department of the Central Bank of China imposed a massive fine of CNY 6 million (895800 USD) on the local branch of ICBC (Industrial and Commercial Bank of China) for failing to assure client identities and submitting audit reports on large and suspicious transactions as required. 

The Bank of Chongqing is required to pay CNY 4 million with the Rural Commercial Bank of Chongqing to pay CNY 2.6 million as a part of fines for the failure of protecting customer data and records while performing transactions with unverified clients.

In the northeast of China, the Jilin branch of ICBC was fined as per reports they also are charged to pay CNY 5.1 million on the same claims of failure and inadequacy as stated by the PBOC’s Changchun branch on June 17.

The local branch of the industrial bank in Guiyang was also penalized for CNY 1.8 million fine as the lender claimed the unfulfillment of customer identification obligations. Moreover, the Bank of Guizhou was fined CNY 2.8 million for the violation of anti-money laundering regulations as per reports of the Central Bank Guiyang arm.

Suggested Read: China Warns Of Money Laundering Risks Arising From NFTs


Prevailing Financial Crimes Make London a Safe Haven for Money Launderer

The UK’s capital is exposed to multiple financial crimes including money laundering and thefts with multiple investment breaches in the past.

The primary causes of illicit financial funding are intensified around the city of London as the money launderers consider it a haven for their involvements. Since the dawn of Russia’s ongoing conflict, a number of scrutinized illegal financial activities are conducted around the city. 

One of the major challenges faced by the United Kingdom is the passive foreign policy which accepts the investments from the countries with lenient security approaches for the financial crimes. The issue that makes the Londongrad a safe place for the transfers of illicit funds is the acceptance of large sums of money at various platforms in the city. 

According to Joy Macknight, the editor of the Banker, Financial Times Group UK, London is a centre of dirty money, and the issue of Ukraine has once again raised the concerns. 

The Transparency International (TI) UK recently added to their reports about the number of questionable funds worth 6.7 billion GBP. As per TI, the assets in central London and other areas of the city like Westminster and Kensington form a massive part of this value.

On this news from the TI, the independent UK also reported that: “It is held by companies in Britain’s Overseas Territories and Crown Dependencies. The secrecy provided by these offshore financial centres is often used by those seeking to hide their ownership of assets.”

There are a number of economic crime acts in the UK, one is passed during the Ukraine conflict, which mentioned setting up a register for the overseas entities and their beneficial owners. 

According to Farzana Baduel, the CEO of the financial firm that deals in public relations, Curzon PR, “The UK has incredible soft power around the world, but we are resting on the laurels of our past and we are watching our integrity disintegrate. I have worked with over 18 different governments and they say to my face ‘ugh’ we can buy your prime ministers,”.

Suggested Read: UK’s FCA Warns Challenger Banks Over Inadequate AML Measures


Canada’s MP Introduces Private Member’s Bill to Amend Criminal Code

The members of parliament of Simcoe North, including the deputy minister of finance, have introduced a private member’s bill in the house of commons, specifically concerning the money laundering activities

The news comes from the federal capital of Canada, Ottawa that the members of the parliament and the minister of finance have joined hands and introduced a new bill in the house of commons. 

The adoption of the bill will amend the law for the criminal code in the country, to make it an offence for a person as enlisted in section 5 of the Proceeds of Crimes such as money laundering and terrorist financing. This also acts on the corporate structures entities as well. Those who have violated the regulation could face a ten-year prison with a fine of up to 1 million CAD.

This bill will be a new toolkit for the law enforcement agencies in Canada to combat money laundering. According to the report from the leading anti-corruption and transparency organisation of the country, Transparency International (TI) Canada, the country has amassed a reputation for easy jurisdiction for the national and international criminals to launder money. 

James Cohen, from TI Canada, stated on the bill that the organisation is pleased to see the adoption of the bill that complements with increasing the efforts and attention of the country to fight money laundering and other illicit crimes. It is also a good measure of the national reputation of the country in terms of jurisdiction for putting an end to ‘snow washing’. 

He added: “This proposed amendment can be a crucial tool in closing one of the many gaps that have been exploited by kleptocrats, tax cheats, and their enablers. TI Canada hopes to see all parties come together to move this proposal forward.”

Kevin Comeau, the CD Howe Intelligence Memo expert, also acknowledged the challenge with Canada’s current regulations on money laundering measures, He said: “Under our present anti-money-laundering rules, financial institutions and designated non-financial businesses and partnerships (Reporting Entities) are legally required to collect and verify the identity information of their clients.  Reporting Entities failing to do so are subject to sanctions. 

The bill will be an integral part of the budget for 2022 for complementing the publicly accessible beneficial ownership by implementing strict crime regulations on the entities that provide false identities even for corporate structures. 

Suggested Read: Canada Financial Crimes Agency Questioned on Effectiveness Of Anti-Fraud Measures


Austrac Warns of Money Laundering Risks Unless More Prosecutions are Conducted

Austrac has warned the law enforcement agencies in Australia that they must conduct more money laundering prosecutions to comply with the international regulations.

Austrac is the head of Australia’s financial agencies and it has issued a warning to prevent the allegations that international authorities can impose if suitable money laundering measures are not taken. The agency warned the law enforcement agencies to conduct more money laundering prosecutions in the country as per international regulations.

According to Nicole Rose, the CEO of Austrac, it was not an easy task to convince the Australian chief executives and board members to take money laundering seriously. Austrac has taken several legal actions which included the record $1.3 billion fine on Westpac to build solid foundations of anti-money laundering regulations in Australia. 

She also mentioned that the gambling industry is also in the spotlight of the agency and also needs a lot more work to increase its credibility status in the market. 

Nicole also appeared at the conference organized by the association of certified anti-money laundering specialists (ACAMS). Addressing the conference she mentioned the necessity of the prosecution in accordance with anti-money laundering laws as the country will be measured for its compliance standards, set by the Financial Action Task Force (FATF). Moreover, she thinks that the prosecution issue of money laundering is a lot more complex than executing drug charges. 

She also added: “When I started at Austrac, just over four and a half years ago, I was quite perplexed by the blank expressions I received in response to raising the devastating causes and impacts of money laundering on our community,”

In the last evaluation report of 2016, Australia did not perform well as the Morrison government failed to implement new reforms namely, “tranche 2” reforms for anti-money laundering systems created for evaluating real estate agents and lawyers. 

David Shannon, the director of the mutual evaluation process for the multi-lateral body, the Asia/Pacific Group on Money Laundering warned about the possibility of Australia being on the FATF “grey-list” as they are not doing well enough to combat money laundering and terror financing. 

“Theoretically FATF does list its own members for serious failures in non-compliance,” he said.

Suggested Read: Australia Risks Damage To Economy Unless Money Laundering Laws Are Improved


The Netherlands To House an EU-based Anti-Money Laundering Agency in the Hague

The Netherlands is aiming to create a new anti-money laundering agency with the principles of the European Union in the Hague as a measure against illicit activities and compliance with international regulations.

The Hague is looking to accommodate another new anti-money laundering agency with all the laws and guidelines of the European Union. The new AMLA (Anti-Money Laundering Authority) aims to battle crimes, specifically money laundering and terrorist financing from various organizations. The initiation of the office can also generate a healthy income for the city with an estimated amount of ​​25 – 30 million euros per year, according to the Omroep West.

The exact date of initiation of the agency is not specified yet, but it is predicted to be performing in 2023 with fully operational procedures by 2026 that will be able to accommodate between 200 to 600 entities. The official location of the agency’s headquarters is also not yet recognized, also no European country has been formally applied for the purpose up till now. But the cabinet of the Netherlands favors the royal capital of the country, The Hague to house the new Anti-money Laundering agency. 

According to the statement from the Hague city council, as per news from Omroep West, the Hague is working on creating a strong status internationally to work in regulating laws. He stated: “In order to remain relevant as a beacon of peace and justice in the future, The Hague is actively working on deepening, broadening, and renewing this profile. This is done, among other things, by attracting new organizations that suit the city,”.

Regarding the sustainability and economic growth of the city, The municipal executive of the Hague also believes that the European organizations can assist in providing opportunities to the students in the town such as internships and other employment. On the housing of the new employees, the city council suggested the settlement in the surrounding areas.

The report from the Omroep West also mentioned that Germany, France, Austria, and Italy can also apply to host the new agency. The decision is completely in hands of the European Commission.

Suggested Read: Businesses At Risk Due To 6AMLD By The European Union


Swiss Prosecutor Identifies Trail to Credit Suisse Money Laundering Case

A Swiss Prosecutor has identified the trail leading to the Credit Suisse money laundering case worth $60 million.

The global investment bank and financial institution of Switzerland, Credit Suisse is on the verge of facing more challenges. As the top Genevan financial crime prosecutor Yves Bertossa has found $60 million of laundered assets through the Swiss bank, as per reports from Bloomberg from the hearing of June 8.

Bertossa presented the case in the meeting last week. He included the identification of eight transactions that, according to him, are alleged. The bank allowed all those transactions during the six-year tenure between 2008 to 2014. Moreover, these transactions also include transfers into third-party accounts. 

Patrice Lescaudron was alleged as the central figure of the whole operation who faked the signatures for the creation of dummy portfolio statements in order to illicitly transfer millions of dollars. The ex-Georgian Prime Minister Bidzina Ivanishvili was claimed to cover the losses in different portfolios of the clients. This move would lead to his conviction and imprisonment over fraud and forgery in 2018. 

Lascaudron was an employee at the bank who was released from prison in 2020, apparently only to commit suicide. Credit Suisse repeatedly insisted on putting Lescaudron behind all the cases. They stated that he was a lone actor who was involved in multiple crimes without the support of any other employee. But under the laws of the Swiss authorities, the lack of resilience to the money laundering activities from any organization is itself charged as support to the illicit practice of money laundering. 

According to the Swiss prosecutor, Bertossa, lacking oversight of Lescaudron and firms majors, allowed money laundering to happen. The official indictment could be months away as Swiss courts process the evidence.

The lack of controls on the Swiss global investment bank can also put the organization in more trouble. Credit Suisse could face another charge that lacked the controls of prevention of financial crimes.

In March, the court of Bermuda ruled against the offshore insurance unit of Credit Suisse in favor of Ivanishvili, claiming that the bank had lacked the authority by not taking protective measures against Lescaudron’s fraudulent activities.

Suggested Read: Swiss Watchdog FINMA Mandates AML Policies on Crypto


FATF Removes Malta From grey List of Untrustworthy Financial Jurisdictions

After one year of being included in the FATF grey list, the global action committee has voted Malta off the list of untrustworthy financial jurisdictions

The financial action task force removed Malta from the grey list on Wednesday. The FATF vote is confidential, and the outcome will not be made public until the completion of the plenary session on Friday afternoon. However, according to the Times of Malta, the financial regime was given the green light in a high-level plenary vote in Berlin.

When a country was placed on the grey list, international assessors and organizations scrutinized it more closely. Malta was removed from the list four months after the FATF publicly said that the first indicators showed Malta had substantially completed the necessary reforms and looked to have resolved the identified inadequacies.

Malta has been called upon to make many reforms to the way it fights tax evasion, collects information on ultimate beneficial ownership, and exchanges data with local and foreign agencies.

These flaws were at the core of a FATF’s plan of action that Malta had to complete before the global anti-money laundering group gave it a clean slate. The vote was taken with 37 jurisdictions and two regional firms, the European Commission and Gulf Cooperation were involved that are said to be the verified members of the Financial Action Task Force.

The vote was held on the resolution provided by the draft. 

Malta was added to the grey list of the global anti-money laundering in June 2021 in response to the lack of reactions to the financial crimes in the country. At that time, Prime Minister Robert Abela said that the decision was “unjust”. He promised to improve the reforms for financial wrongdoing. 

The greylisting decision came in the years of international criticism of Maltese policymaking. It also added the response to selling Maltese citizenship against top government officials who are suspected of corruption. 

In other words, the FATF advises the international community to avoid doing business with blacklisted countries or to do so only under strict conditions. Currently, only North Korea and Iran are on the blacklist of the global watchdogs

According to the FATF’s second public publication, the process of “Improving Global Anti-Money Laundering Compliance: On-going Process,” is referred to as the “greylist” unofficially.

Suggested Read: Malta Claps Back To Allegations Of “Lax Crypto Oversight”

meps disclose

MEPs Disclose Plans To Crack Down On Money Laundering – AMLA Reports

The civil liberties and economic affairs committees discussed the plan to establish an EU Authority for tackling the issues of money laundering and terrorist financing.

The proposal for the establishment of the Anti-money laundering Authority (AMLA) aims to enhance the cooperation and exchange of information between the Financial Intelligence Units (FIUs). This will act as the intermediate between financial entities and law enforcement.

The AMLA is a step towards the elimination of money laundering and all the illicit attempts of terrorist financing that will contribute to the supervision of finances across different industries and sectors. The economic affairs committee discussed the plans, on which the co-rapporteur, Emil Radev (EPP, BC) said: 

“AMLA will strengthen the EU’s supervisory framework for combating money laundering and terrorist financing. To get the best results, AMLA must have enough time to develop its full potential and contribute to winning the fight against money laundering and terrorist financing. Through direct supervision and delineation of the riskiest cross-border obliged entities in the financial sectors, AMLA will contribute directly to the Union’s fight against dirty money. I believe that the exchange of information is extremely important and it is crucial that the FIUs and AMLA work in very good cooperation and exchange information in order to better combat money laundering and terrorist financing. To do this, the AMLA must have a strong coordinating role.”

Another co-rapporteur Luis Garicano added to the statement that the approach being used by the EU as a security measure towards the attempts of money laundering has only yielded new scandals. Now is the time to repress all the gateways in Europe. The EU’s new AMLA represents the opportunity to monitor the cross-border entities and put an end to the economic nationalism which is fuelling the endless cycle of money laundering. He further added that some members of the have accommodated the dirty money which comes easily and have been engaged in the race for the bottom. 

“This comes at a time of particular need for Europe. A strong AMLA is the best tool to ensure Putin´s oligarchs pay for their complicity in Russia´s war of aggression. By establishing an EU-wide supervisor that is able to leverage the latest financial intelligence, we are taking the economic war to the next level. Sanctions can only work if they are enforced. AMLA´s contribution will pay dividends here.”

Suggested read: EU Proposes New AML Agency For Addressing Money Laundering

bc moey laundering

BC Money Laundering Inquiry Report Calls for New Law Enforcement Unit

BC has released a money laundering report that carries multiple recommendations and includes the directions for creating a new law enforcement unit as well as a permanent commissioner.

The long-waited report came out on Wednesday, the 15th of June, with over 100 recommendations to address the multi-billion dollar issue of money laundering. The inquiry of the commission was led by B.C. Supreme Court Justice Austin Cullen after the government detected a number of scams traced by the reports in May 2019. The extraordinary levels of money laundering were exposed in the real estate business, luxury cars sectors, and horse racing. In the final report, Cullen said that human trafficking also adds up to the problem.

The report from Cullen presented the flaws in the law enforcement agencies and the lack of action on the crimes of money laundering. The 1800-page report described the failure of prioritization that let the problem thrive for so long. It also put blame on the federal agency that received and analyzed the data generated by the money laundering threats. According to the commission, FINTRAC has failed to provide the information back to the provinces.

The example mentioned targeted the reports received by FINTRAC in 2019/2020. Of 31 million reports only 2057 reports were disclosed to the law enforcement agencies across Canada and 35 to the B.C. The outcome of this made the reporting entities move with a “defensive reporting” approach.

The solution stated by Cullen is that law enforcement must create a dedicated unit to investigate money laundering intelligence. On the legislative level, Cullen also recommended the establishment of the government-backed office with an independent Anti-Money Laundering Commissioner, who will provide oversight on strategic B.C’s response.

Suspicious buy-ins of cash are common in the casinos which also give rise to other criminal activities. Cullen estimates multi-million dollars were laundered between 2008 to 2018. He says that the criminals used the “Vancouver model” as their main method of casino money laundering. In 2014, the B.C casinos accepted over $1 billion of transactions that included 1881 individual buy-ins of $100,000 as per Cullen’s report.

Cullen also pointed out the corruption done by elected officials who are not suspected. Attorney General David Eby also stated: ​​“I’ll say frankly, as a politician, I wouldn’t be satisfied with a sash from the commissioner that says ‘not corrupt.’ I hold myself to a higher standard,”.

This clearly shows the dissatisfaction with no corruption reports among the elected officials.

Suggested Read: Money Laundering to Remain a Significant Challenge with Spike in Online Crime

eba issues

EBA Issues Guidance on the Roles of AML/CFT Compliance Officers

The European Banking Authority has published guidelines that state the roles of Anti-money laundering and Counter-terror financing (AML/CFT)officers, and also specify the responsibilities of management bodies of Financial institutions.

The guidelines published by the EBA (European Banking Authority) aim to ensure the common explication and complete implementation of the Anti Money Laundering and Counter-terror financing laws. It ensures that the internal governance arrangements across Europe fall under the AML/CFT regulations with complete compliance with the EU directive on the prevention of the use of financial systems for money laundering and terrorist financing.

The guidelines are a clear explanation of the roles and responsibilities of the AML/CFT compliance officer as well as the management bodies. The specification issues the financial and credit institutions to appoint one specific person from their management team. That selected member will be responsible for the implementation of AML/CFT regulations. The EBA guidelines also described the roles of the compliance officer to be a part of the criteria and should ensure the AML/CFT regulations are being followed at the financial firms. 

The guidelines proposed by the European Banking Authority are supposed to create common grounds for all the competent authorities and financial institutions in AML/CFT governance arrangements. They complement but do not replace the related guidelines proposed by the EBA on the basis of suitability checks and wider governance arrangements. 

Legal Background And Laws

The draft of the guidance by the EBA is in line with the coordination and monitoring of the EU financial sector’s fight against money laundering and terror financing. 

In the drafting procedure of these guidelines, the EBA fulfills the Commission’s request in its SNRA (Supra-National Risk Assessment) of 2019 to create an instruction that “clarifies the role of AML/CFT compliance officers in credit and financial institutions”.

Sound AML/CFT governance arrangements are essential for the fulfillment of the private sector’s watchman role and therefore for preventing and fighting ML/TF.

Suggested Read: Council of Europe Urges Montenegro to Step Up AML Measures

lithuanian govt

Lithuanian Government Approves Amendment to Strengthen Digital Currency Regulations

Lithuania is on the verge of becoming the first country in Europe to pass strict laws on digital currencies. It aims to prevent Russia from evading the sanction in the market.

The Lithuanian MoF (Ministry of Finance) announced the approval of the government proposed in the draft law for the “Prevention of Money Laundering and Terrorist Financing.” The proposals in the law include complete user identity verification and a ban on anonymous accounts. The approval also places the new obligatory measures on the exchange of digital currencies. This includes having the nominal capital amount of no less than 125,000 euros i.e $130877.

The exchanges in Lithuania are also required to register as corporate bodies and are must-have top executives in the country. As the MoF states, these amendments will help increase the transparency of digital assets such as cryptocurrencies and NFTs in the market.

The finance minister of Lithuania, Gintarė Skaistė stated that the amendments are parallel with the laws and regulations prepared by the European Union (EU). She added that this will help in the sustainability of the European market. 

Gintarė Skaistė stated: “The proposed changes will ensure greater transparency and higher quality standards in the sector, contributing to the sustainable integration of the cryptographic asset segment into the country’s wider Fintech ecosystem,”

She also added that the today’s geopolitical environment will be a plus for the proposals of the digital currency regulations, “we must ensure that no attempt is made to circumvent Western sanctions on Russia by using cryptographic assets,”

The law was proposed in close coordination with the Financial Crime Investigation Service (FNTT) of Lithuania, Bank of Lithuania (LB). The Ministry of the Interior and the Money Laundering Prevention Competence Center were also involved in the conjunction of the law.

The law still needs to undergo the processing of Seimas, the unicameral parliament of Lithuania. The ministry of finance is confident to see the implementation of several amendments by 2023.

At the present moment in Lithuania, there are over 250 digital asset firms operating in the nation of 2.8 million people. When the country started to inquire about the transactions, there were several transactions that were reported as used for AML/CFT purposes worth over 1000 euros.

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