For the European Union (EU) member states, the Sixth Anti-Money Laundering Directive (6AMLD) comes into force this week (3rd December) and must be implemented by financial institutions by 3rd June 2021. It focuses on standardising the approach of EU member states to the offence of money laundering, as well as expanding the scope for potential liability for money laundering and the range of sanctions that EU member states are required to impose under local law.
The United Kingdom (UK) has opted out of 6AMLD, as the government deems that it is already compliant.
“The UK’s domestic legislation is already largely compliant with the Directive’s measures, and in relation to the offences and sentences set out in the Directive, the UK already goes much further. Therefore, the Government decided not to opt in as we did not consider that opting in would enhance the UK approach to tackling money laundering”.
Following 5AMLD, which broadly strengthened existing Anti-Money Laundering (AML) and Terrorist Financing (CFT) provisions, the 6AMLD intends to sanction financial institutions and authorities to do more in the fight against money laundering and terrorism financing by expanding the scope of existing legislation, clarifying certain regulatory details and toughening criminal penalties
What is included?
Extension of Criminal Liability to allow for punishment of legal persons, such as companies or partnerships. The extension of criminal liability in this context is intended to hold larger companies to account in the global effort to combat money laundering.
Tougher Punishment with the introduction of a minimum prison sentence of four years for money laundering offenses (the previous minimum sentence requirement was one year). It is worth noting that many EU member states already implement punishments for money laundering that exceed the minimum prison sentences required by 6AMLD.
Member-State Cooperation to allow specific information sharing requirements between jurisdictions, so that a criminal prosecution for the connected offenses can take place in more than one EU member state. Known as dual criminality, a principle that a crime often committed in one jurisdiction before its financial proceeds are laundered in another.
Expanded Regulatory Scope to include “adding and abetting”, which will also constitute as money laundering and be subject to the same criminal penalties.
Harmonization of the definition of money laundering, with a list of the 22 predicate offences that constitute money laundering, including certain tax crimes, environmental crime, and cyber-crime.
The 6AMLD aims to put professional money launderers out of business, the directive allows better targeting of larger companies who fail to eliminate money laundering, exposing those that fail to implement effective risk assessments, comprehensive training and internal procedures that contribute to eliminating this illegal activity.
If you are preparing for 6AMLD or are just in need of further assistance within your Financial Crime team, Danos Consulting can help…
Firms need to use the next six months efficiently, to ensure that their AML/CFT frameworks are robust and responsive to the new directive. Danos Consulting can support you from risk assessment to implementation of AML governance structures, staff training and vendor selection, and client screening and monitoring practices.
We have an experienced bench of Financial Crime professionals from more senior MRLOs (Money Laundering Reporting Officers) level consultants to more hands-on transaction monitoring, sanctions screening, AML/KYC practitioners. These consultants can be setup remotely at first to be able to assist as soon as possible.
Danos Consulting can help tailor any solution to fit a client’s needs. It is your choice on the length and structure of the contract such as Pay As You Earn (PAYE), Fixed-term or via a Limited Company. We are able to payroll the consultant as well to make it an even easier process for you.
This year alone we have helped firms within the Crypto, FinTech and Payments space with the following projects:
- Multiple consultants for a Transaction Monitoring piece
- Multiple consultants for PEP’s and Sanctions screening
- Onboard an MLRO to monitor ongoing projects and provide a risk assessment
- Consultants hired for a client onboarding backlog
- Cryptoasset generalists to advise and then adapt on a firms 5AMLD policies and procedures
Please contact Bradley Handelaar if you would like to discuss any requirements you might need now or in the future.
Tel: +44 (0) 207 010 1154