A clause has been introduced for debate in the Economic Crime Bill, which is now on its third reading in Parliament, to create an offence of “failure to prevent fraud, false accounting or money laundering”...
Category - Financial Crime Prevention
Emma RadmoreFSM Bill Grand Committee stage starts
The first day of the Lords Grand Committee hearing on the FSM Bill took place on 25 January. There are now 6 dates scheduled in total, with sittings taking place now on 30 January, then 1, 6, 8 and 20 February. 195...
FCA feeds back on crypto applications
FCA has published its feedback on good and poor quality applications made by crypto firms under the MLRs. FCA has seen and refused so many bad quality applications it has now provided guidance to firms on what they have...
NCA publishes SARs report 2020-22
NCA has published its SARs annual report, which covers a 2 year period since it did not publish one in 2021. Key statistics are: a record over 900,000 SARs received and processed in the last financial year – 21%...
Economic Crime and Transparency Bill at Report stage
The Economic Crime and Corporate Transparency Bill has completed the Committee stage in the Commons and moves to the Report stage on 24 January. Sittings are scheduled for both 24 and 25 January.
Further FSMB amendments for Lords Grand Committee
Further amendments, and an updated running list of amendments, to the FSM Bill to be discussed in the Lords Grand Committee have been published. Among the latest additions are changes which would: remove short selling...
Treasury Committee publishes FCA information request
The Treasury Committee has published a letter sent to Nikhil Rathi on 1 December, asking for details on: total vacancies FCA has in specific areas, by grade, job and which ones require data or technology skills; how FCA...
Lords publishes FSMB amendments for Committee
The House of Lords has published a set of amendments to the FSMB for discussion in the Grand Committee, which is now scheduled to sit on 25 and 30 January and 1 February. The amendments include several amendments that...
FCA feeds back on OPBAS rulebook update
FCA has published the feedback it received on its consultation on updating the OPBAS Rulebook, and the revised rules, which took effect from 10 January 2023. FCA wanted to include a new chapter outlining OPBAS’...
FCA updates on Skilled Persons reports
FCA has published the figures for its Skilled Persons reports commissioned in the period from July to October 2022. 11 were commissioned in total, with 4 in the retail investments area, none for general insurance and...
FSMB completes second reading in Lords
The FSMB had its second reading in the Lords on 10 January. Baroness Penn, leading for the Government, summarised the importance of the Bill and its overarching aims, which she described as: implementing the outcomes...
Market Watch looks at DRSP service
Edition 72 of FCA’s Market Watch looks at the quality of service that Data Reporting Services Providers give. Given the importance of DSRPs to the functioning of wholesale markets and promoting transparency and...
FCA fines Al Rayan Bank for AML failings
FCA has fined Al Rayan Bank PLC £4m for failing to have in place proper AML controls over 2.5 years to the end of November 2017. The bank is a subsidiary of a Qatar-based Islamic bank, and provides Sharia compliant...
Stanford v HSBC – further analysis of the Quincecare duty
We reported on this judgment before Christmas. Now read our more detailed analysis of the judgment and its effects.
FCA fines Guaranty Trust Bank again for AML failings
FCA has fined Guaranty Trust Bank (UK) Ltd, the UK subsidiary of Guaranty Trust Nigeria Bank Limited, over £7.5m for AML systems and controls weaknesses spanning a period of nearly 5 years to July 2019. It had...
Treasury publishes AML and CFT supervision report
HM Treasury has published its “Anti-money laundering and countering the financing of terrorism: Supervision Report 2020-22“. The report addresses the performance of anti-money laundering (“AML“)...
Duncan ScottSupreme Court judgment in Stanford/HSBC case looks at recoverable losses
The Supreme Court has held that, where HSBC actioned instructions that may have been part of a fraud, but which resulted in creditors being repaid, then regardless of whether it had a Quincecare duty and, if it did, had...
Onerous or essential: banks’ duties and APP fraud
Read our article by Stephen Dilley and Rasmita Roy Chowdury, looking at the history and case law relating to banks’ duties and APP fraud reimbursement.
Government raises POCA ‘exemption’ threshold
The Government has published the Proceeds of Crime (Money Laundering) (Threshold Amount) Order 2022 and an accompanying explanatory memorandum. The Order will amend section 339A of the Proceeds of Crime Act 2002...
The Edinburgh reforms – and more
See our article, summarising various FIN posts over the past week on the state of play of the FSM Bill and the Edinburgh reforms.
Latest Market Watch focuses on insider lists
FCA’s Market Watch Issue 71 concentrates on changes to advisory firms’ insider lists since the guidance FCA gave in edition 60, when it criticised firms for having unnecessarily large numbers of insiders. It...
Treasury puts in place Haiti sanctions
The Haiti (Sanctions) Regulations 2022 will take effect from 28 December, following a UN Security Council Resolution. OFSI has published guidance to accompany the Regulations which will, among other things, include on...
FCA fines Santander for AML failings
FCA has fined Santander UK plc £107.7m for serious and persistent gaps in its AML controls that related to its business banking customers. It found that over a period of nearly 5 years from the end of 2012, the banks...
“Edinburgh” reforms highlight ring-fencing, CCA and post-Brexit changes
The Chancellor has announced a set of so called “Edinburgh reforms” to the financial services regulatory framework. At an industry roundtable, he will set out plans to repeal and replace “hundreds of...
PSR updates on APP scam data
The PSR has published an update on its plan to publish data on how banks and building societies are responding to APP scams. PSR will require the 14 largest PSPs in the UK to provide 6 monthly data on APP scam...
FCA fines brokers for market abuse detection failings
FCA has fined 3 firms within the BGC and GFI group a total of £4,775,200 for failure properly to implement the MAR trade surveillance requirements, which meant there was an increased risk that the firms would not detect...
Tribunal backs FCA on crypto-refusal decision
The Upper Tribunal has published its decision made in September on an application by Moneybrain Limited. Moneybrain had created a type of cryptocurrency called BiPS tokens and had applied to FCA to be registered as a...
FSM Bill – Lords dates announced
The FSM Bill as amended after its passage through the Commons has now had its first (routine) reading in the Lords. The Lords’ second reading has been set for 10 January 2023.
FSM Bill report stage
As scheduled, the FSM Bill had its report stage on 7 December and, eventually, at nearly 7pm, the Third Reading of the Bill took place and was agreed to. The Bill now moves to the Lords. While we still await the new...
Lucy HadrillEuropean Council agrees strengthened AML rules
The European Council has agreed its position on both an AML regulation and a new directive (AMLD6). These regulations aim to improve risk mitigation, detect criminal activity and ensure the EU’s financial system...
Nicola RadfordEBA consults on guidelines to address de-risking
EBA has opened a consultation on two new sets of guidelines which look to address the effective management of money laundering and terrorist financing risks when providing access to financial services. The aim of the...
JMLSG publishes revisions to Guidance
JMLSG has published amendments to several parts of its guidance, and has submitted the updated versions to Treasury for approval. The revisions update: Chapter 5 of Part 1 (5.5.11) to update provisions on high-risk...
FSM Bill report stage on 7 December
The FSM Bill is to have its report stage and third reading in Parliament on 7 December, after receiving the Bill with amendments from the Public Bills Committee. It is possible for Parliament to make amendments at...
FCA fines JBI for breaches of Principle
FCA has fined Julius Baer International £18,022,500 for breaches of Principles 1, 3 and 11 at various times between 2007 and 2014. It has also decided to ban 3 individuals – all of whom have taken their case to...
EBA finalises remote onboarding guidelines
EBA has published its final guidelines on the steps credit and financial institutions should take to ensure safe and effective remote customer onboarding. The guidelines include: expectations for policies and procedures...
Emma RadmoreHMRC updates MSB guidance
HMRC has published updated guidance for MSBs on understanding risks and taking action. It confirms that MSBs are seen as attractive vehicles for criminals and gives examples of how MSBs have been used for money...
FCA publicly censures former Sonali Bank CEO
FCA has at last issued its final notice which publicly censures Mohammed Ataur Rahman Prodhan, former CEO of Sonali Bank UK. FCA had already taken regulatory action against both the bank and its MLRO in relation to AML...
LSB and PSR sign MoU
The LSB and PSR have signed and published a memorandum of understanding. setting out how the bodies will co-operate and communicate. The accompanying press release note who LSB champions the CRM Code and wants to work...
FCA reacts to FTX failure
FCA has noted that UK customers of FTX may be alarmed following its provisional liquidation in the Bahamas and filing for bankruptcy in the US. It had previously warned customers that FTX is not regulated in the UK and...
Lords Committee disappointed with UK fraud response
The House of Lords Fraud Act 2006 and Digital Fraud Committee has published a report called “fighting fraud: breaking the chain”, which expresses its disappointment at how the UK is reacting to the...
Final day of FSMB debate published
In the morning and afternoon of the final day of the Public Bills Committee debate on the FSM Bill, the remaining tabled new clauses were discussed: that the Chair of the PSR should be a member of the FCA board: this...
LSB reports on progress of CRM code in tackling APP scams
The LSB has published a review of the progress that has been made by signatories to the Contingent Reimbursement Model Code (CRM Code) in tackling APP scams. The LSB concluded that the firms which have signed up to the...
Andrew Griffith letters on FSMB
The House of Commons has published a letter from Andrew Griffith on the FSM Bill dated 10 October to Tulip Siddiq and Abena Oppong-Asare. The letter followed the second reading of the Bill and addresses: the...
FCA prosecutes individuals for investment fraud
Following FCA application, there will be a trial of 4 defendants in February 2023 for alleged investment fraud. FCA alleges the 4 individuals were involved with a London-based company called Bespoke Markets Group...
OFSI updates Russian sanctions guidance
The FCDO, OFSI and the ECJU have updated its guidance on the scope of the sanctions against Russia and when a licence might be available. The update caters for the most recent regulations (Amendment number 15), which...
Economic Crime and Corporate Transparency Bill continues Committee stage
The Economic Crime and Corporate Transparency Bill has had its 3rd, 4th and 5th sittings in the Public Bill Committee. It heard evidence from several regulators, industry organisations, financial institutions and...
Wolfsberg Correspondent Banking Principles updated
The Wolfsberg Group has published its finalised updated financial crime principles for correspondent banking. The update from the 2014 version: looks at the differences between correspondent relationships and...
Economic Crime and Corporate Transparency Bill starts Committee stage
The Economic Crime and Corporate Transparency Bill has started its Committee stage in Parliament. On 25 October, it heard from a number of witnesses including UK Finance and the BVCA, the NCA and Companies House. The...
Highlights of FSMB debates from 25 October
The 3rd and 4th sittings of the Public Bill Committee debate on the FSM Bill took place on 25 October. After the evidence sessions from witnesses on 19 October, the line-by-line scrutiny of the Bill has now started...
FATF consults on BO guidance
FTAF is consulting on updates to its guidance on Recommendation 24, following the amendments to the Recommendation that it adopted in March. The draft guidance explains the purpose of gathering beneficial ownership...
Court finds mortgage adviser had no duty to investigate underlying investment
The High Court has ruled on a case brought by investment fraud victims in a clarification of mortgage advisers’ duties. The judgment in Taylor & Anor v Legal and General Partnership Services Ltd [2022] EWHC...
Further FSMB revisions released
Parliament has published the latest raft of proposed amendments to the FSM Bill. These include: a change to the very first sub-clause, replacing the revocation of the EU and EU-derived legislation in the schedule so...
Call for evidence on Economic Crime Bill
The Public Bill Committee has invited written evidence on the Economic Crime and Corporate Transparency Bill, which is due to start its scrutiny in the Public Bill Committee on 25 October, and to conclude by 24 November...
ML threshold amount to be increased to £1000
A draft statutory instrument has proposed the increase of the “threshold amount” above which banks suspicious of money laundering cannot deal without appropriate consent from the current £250 to £1000. The...
OFSI and OFCA announce enhanced partnership
OFSI and OFAC held a multi-day technical exchange designed to aid collaboration between the agencies in future. In practice, this means that OFAC and OFSI officials will more often exchange best practices and pool...
FSMB Committee stage timetable published
Following the announcement that the Committee stage in the Commons will begin on 19 October, a timetable for the sessions has now been published. Key witnesses scheduled to appear on that day include BoE, PRA, FCA and...
FCA fines Gatehouse Bank for AML failings
FCA has fined Gatehouse Bank £1.5m (after a 30% reduction for early settlement) for significant weaknesses in its AML controls which lasted for 3 years to July 2017. It found the bank generally failed to conduct...
FSMB Committee stage scheduled for 19 October
An update to the Parliament website shows the Committee stage for the Financial Services and Markets Bill will start on 19 October. After the line by line debate is complete, the Bill will be republished for report...
FATF publishes timetable for 4th round evaluations
FATF has published its procedures for the fourth round of mutual evaluations. The procedures include details of the notice periods and the manner in which the evaluations will take place, and the publication of reports...
FSB consults on regulation of crypto assets and markets
The Financial Stability Board has published a consultative report including some high level recommendations aimed at promoting consistent and comprehensive treatment of crypto-asset activities and markets. The 9...
TI says LLPs abused “on industrial scale” for financial crime
A Transparency International report claims that 14% of all LLPs ever incorporated (21,000) show money laundering red flags. Its report comes as the Economic Crime and Corporate Transparency Bill nears its parliamentary...
FCA fines and bans for market abuse reporting failures
FCA has fined Sigma Broking Limited and has banned and fined its former directors. The firm failed to make reports, or accurate reports, on 56,000 CfDs over a period of just over 18 months to August 2016, and also...
Market Watch focuses on transaction reporting
The latest edition of Market Watch looks at how many firms have accessed FCA’s Market Data Processor Entity Portal over the past 4 years – and there has been a gradual increase. There has however been a...
New Russian sanctions in place from 30 September
In response to the illegal annexation of 4 Ukrainian regions, the Government has imposed sweeping new sanctions the effect of which is to deny Russia access to key services including IT consultancy, architectural...
PSR sets out APP scam protection proposals
PSR is consulting on how to increase consumer support for APP scams. Following the initiatives it has taken to date, the new measures will: require reimbursement in all but exceptional cases; improve and make...
OFSI fines for sanctions breach
OFSI has published details of a monetary penalty imposed on Hong Kong International Wine and Spirits Competition Ltd. The fine, of £30,000 related to 3 payments and 78 wine bottles the company had received from a...
Economic Crime and Corporate Transparency Bill heralds Companies House reform
The Economic Crime and Corporate Transparency Bill has started its parliamentary passage. The Bill aims to crack down on money laundering and other crimes, primarily through: the long-promised Companies House reforms...
FOS publishes latest complaints data
FOS has published its latest quarterly data on complaints in relation to financial products. The data covers the period of April to June 2022, and can be accessed in full as a spreadsheet. Over the period, the average...
FCA speaks on “force multiplier effect”
Sarah Pritchard, Executive Director of Markets at the FCA has recently given a speech on how the “force multiplier effect” is key to fighting financial crime. She said the role of those in the first line of...
OFSI publishes annual frozen asset request form
OFSI has published the annual frozen assets reporting notice, template and accompanying guidance notes. All persons who hold or control funds or economic resources belonging to a designated person should complete the...
OFSI updates sanctions guidance
OFSI has published a blog on who needs to make reports to it in relation to financial sanctions issues and how, and also also updated its general guidance on financial sanctions to give greater guidance on reporting.
Wolfsberg Group publishes transaction monitoring RFI guidance
The Wolfsberg Group has published a guidance paper looking at requests for information as used in AML transaction monitoring. RFIs are used when correspondents or other PSPs are looking to understand transactions that...
FCA fines for failure to have trade surveillance requirements
FCA has imposed a fine of over £12.5m on Citigroup Global Markets Limited, for failing to comply with MAR trade surveillance requirements. MAR introduced a requirement from 2016 to monitor orders and trades to detect...
PRA removes deposit taking permission from Sonali Bank
PRA has varied Sonali Bank’s permission so that it no longer has permission to accept deposits. The decision, published in a second supervisory notice, states that the firm is failing to meet the threshold...
JMLSG updates Motor Finance guidance
JMLSG has published revisions to its sectoral guidance on Motor Finance. It has submitted the new guidance to Treasury for approval. The additions to the existing guidance comprise of an FLA industry standard annex...
Companies House writes to overseas entities on register entries
Companies House has written to overseas entities who already own or leave property or land in the UK and who must register information with Companies House by the end of January 2023. Any entity that does not comply can...
FCA updates CiC requirements for crypto controllers
FCA has updated its change in control pages on its website to reflect new forms for controllers of registered cryptoasset firms. From today (11 August), any person deciding to acquire 25% of more control of a registered...
FCA publishes “alternatives” supervisory letter
FCA has published its supervisory strategy letter for “alternatives” – that is firms that are predominantly active in the alternative investment sector. Although the letter, as usual, is addressed to...
NCA and OFSI issue Russian sanction enablers alert
NCA and OFSI have issued a “red alert” sharing information on some of the common techniques that Designated Persons under Russian sanctions and their UK enablers are suspected to be using to evade sanctions...
FCA fines former NED for inside information disclosure
FCA has fined Sir Christopher Gent, former NED of ConvaTec Group, £80,000 for disclosing inside information to individuals in senior positions in two of the company’s major shareholders in advance of its...
Overseas Entities Registration Regulations made
The Register of Overseas Entities (Delivery, Protection and Trust Services) Regulations 2022 were made on 25 July. They specifically: cater for electronic delivery of documents required; list circumstances in which the...
MLR amendments made
The Money Laundering and Terrorist Financing (Amendment)(No 2) Regulations 2022 were made on 21 July. The changes implement Treasury’s conclusions following its consultation and will mainly take effect from 1...
FATF looks at DP, technology and private sector information sharing
FATF has published a report looking at how collaborative analysis and ways of bringing data together can help financial institutions to build a clearer picture of the large and complex puzzle of transactions of which...
PSR annual report focuses on “protecting people”
On the 19th July the PSR released its annual report for 2021/2022, and outlined how it has helped the public in the past year. During the year, the PSR: imposed its biggest ever fine (for cartel behaviour in the prepaid...
FCA publishes Annual Report
FCA has published its Annual Report and supporting papers. It highlighted: how nearly 600,000 people are paying less in interest and charges on credit card debt following rule changes; how further rule changes have...
FCA fines failed firm for financial crime failings
FCA has fined the TJM Partnership, which is now in liquidation, £2,038,700 for financial crime compliance failings in cum-ex trading business. This is the third fine in this area, and the largest. FCA found the firm...
FCA responds to Treasury Committee on responsibilities regarding financial sanctions
FCA has written to the Treasury Committee to respond to questions regarding its financial sanctions responsibilities. FCA confirmed that its role was to ensure that regulated firms have appropriate systems and controls...
Harshil PatelECB speaks on using tech to tackle financial crime
Elizabeth McCaul, Member of the Supervisory Board of the ECB, has delivered a speech on how technology (particularly AI) can be used in the fight against financial crime. Ms McCaul discussed the relationship between...
Upper Tribunal finds failings with crypto trader’s AML compliance
The Upper Tribunal (Tax and Chancery Chamber) has published its decision in Vladimir Consulting Ltd (VCL) v Financial Conduct Authority, in which it has analysed whether VCL’s approach to business was compliant...
Gibraltar added to High Risk Third Countries from 11 July
The latest Government advisory on High Risk Third Countries has added Gibraltar to the list with effect from 11 July, and removed Malta. The UK list continues to mirror the FATF list. The full list is now Albania...
EU reaches agreement on crypto measures
The EU has reached agreement on critical elements of crypto-asset regulation. The European Parliament and the European Council have reached a provisional deal new legislation aiming to ensure that crypto transfers can...
FIN. TeamJoint Statement issued by the Russian Elites, Proxies, and Oligarchs Task Force
The Russian Elites, Proxies, and Oligarchs (REPO) Task Force has released a joint statement outlining how they have been able to isolate sanctioned Russians by freezing, seizure, forfeiture and/or disposal of assets...
UK sanctions more Russian oligarchs
New sanctions under the Russian regime designate more individuals within Vladimir Putin’s inner circle, including Russia’s second richest man, and a relation to Putin’s who is president of a large...
OFSI fines company for employee flight sanctions breach
OFSI has updated its table of monetary penalties for sanctions breaches. The table now reflects a fine on Tracerco Limited, a company operating in the energy sector, which has been fined £15,000 for making funds...
FCA fines Ghana International Bank for correspondent banking DD failings
FCA has fined Ghana International Bank nearly £6m for failings in its financial crime prevention controls in respect of its correspondent banking business. It found that, for a 5 year period to the end of 2016, it did...
FCA fines JLT for more bribery control failings
FCA has levied a second fine on insurance broker JLT Speciality Ltd for financial crime control failings. The £7,881,700 fine follows a previous fine of nearly £2m in December 2013 for similar failings. Following...
FCA seeks retrial in insider dealing case
Following the Court’s decision to discharge the jury after they were unable to reach a verdict following an 8-week trial, the FCA has announced that it will pursue a retrial of Stuart Bayes and Jonathan Swann for...
Outcomes of FATF plenary
The latest FATF Plenary meeting took place from 14-17 June. At it, FATF agreed to severely limit the role of Russia and its influence in FATF; approved a report to help the real estate sector better detect and prevent...
FCA update on market abuse and manipulation
Tackling market abuse is one of the FCA’s strategic priorities. Given recent press reports about the FCA’s approach, the FCA outlined the work it does to tackle insider trading and manipulation and to warn...
Treasury Committee to question OFSI on sanctions effectiveness
The Treasury Committee is to question OFSI as part of its inquiry into effective economic sanctions on Russia. The session will take place on 22 June and is likely to include discussion on the challenges of implementing...