August 2009

Please click on the headings below to read the news for August 2009.

 

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26/08/2009 – Nigeria focuses its AML campaign on DNFIs.

On 25 August 2009, the National Advisory Council of the Designated Non-Financial Industries (DNFI)s was inaugurated. Speaking at the inauguration ceremony, the Minister of Commerce and Industry, Mr. Archike Udenwa, announced that it was “imperative” to focus Nigeria’s anti-money laundering (AML) campaign on the DNFI sector. Under the Money Laundering (Prohibition) Act 2004, lawyers are included in the list of DNFIs.

Mr. Udenwa said this policy arose from an empirical study which concluded that criminals have gradually been gravitating towards DNFIs due to the relative leniency of regulatory focus on this sector. In comparison, the financial sector had been subject to extensive AML regulation.

The newly established Council has been charged with the responsibility of harmonising anti-money laundering standards within the DNFI sector. Its make up comprises two members each from the Economic and Financial Crimes Commission (EFCC), the National Financial Intelligence Unit (NFIU) and professional bodies, such as the Nigerian Bar Association (NBA) and the Chartered Institute of Taxation of Nigeria (CITN).

This move has been commended by the Chairman of the EFCC, Mrs. Farida Wazirim. She noted that the establishment of the Council was one of Nigeria’s strategies to raise her country’s level of AML compliance in line with international standards.

For now, it remains to be seen how these policy statements will translate into practice and how the tightened AML regulation on DNFIs will impact lawyers specifically.

We expect to update our webpage for Nigeria in the following weeks. Please visit us or subscribe to our RSS system in the homepage to learn about this and other news and updates.


Sources:

Leadership Nigeria – “Money Launderers Focus on Non Financial Institutions”.

 

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25/08/2009 – Solicitor in the UK convicted for handling bail monies suspected as proceeds of Crime.

In a recent UK Crown Court judgment, a UK solicitor was convicted and sentenced to 4 years jail for accepting and paying bail securities into court on behalf of his client which he knew or suspected were proceeds of criminal activity, amongst other offences. This case from 1 July 2009 demonstrates that solicitors may be susceptible to money laundering convictions whilst fulfilling their professional duties.

Anthony Blok, 72, a retired solicitor, was convicted of concealing criminal property under s327 Proceeds of Crime Act when he paid £75000 in cash into court for the bail of his client who was arrested for money laundering.

According to the court, the fact that Blok provided a false story on the origins of funds was sufficient to demonstrate that he knew or suspected that the funds were from a criminal source. Blok stated that he had received the cash outside the court from a man he did not know, though the Court’s CCTV showed Blok receiving the cash inside the court from his client’s daughter and another woman. This fulfils the mens rea element of the s327 offence.

In any case, taking into account the surrounding circumstances, the court accepted it was not reasonable for that amount of money to be raised legitimately in such a short period of time, and this should have triggered Blok’s suspicion.

In addition to this count of money laundering, Blok was found guilty of 2 other counts of money laundering, perjury and perverting the course of justice, both when he assisted a client in attempting to sell a stolen painting worth £500 000 and when he held over £30,000 in cash in his office in 2006.

In line with the Law Society’s Money Laundering Taskforce’s previous warnings, this case illustrates the UK’s commitment to enforce solicitors’ anti-money laundering obligations.

For the Law Society’s Money Laundering Taskforce’s warning in 2002, click here.
For the Law Society’s Money Laundering Taskforce’s warning in 2002, click here.


Sources:

  1. Law Society’s press release;
  2. London Metropolitan Police’s press release;
  3. Chambers’ news.

 

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19/08/2009 – Guyana’s President assents to the Anti-Money Laundering Act.

On 17 August 2009, Guyana’s Minister of Finance, Dr. Ashni Singh, announced that the Anti-Money Laundering and Countering of Terrorism Act was assented to by President Bharrat Jagdeo on 14 August 2009. For the first time in legislative history, lawyers are included in the list of designated entities with specific anti-money laundering obligations. Previously, they were exempted from regulatory control under the Money Laundering Prevention Act 2000.

According to a press release by the Government Information Agency of Guyana, requirements in the Act only apply to lawyers when, on behalf of their clients, they engage in the buying and selling of real estate, money management or the creation, operation or management of companies.

When applicable, the Act requires lawyers to establish and maintain records of all transactions completed and the client’s personal information such as his name, date of birth, address and occupation or business activity. These records must be preserved for seven years.

Should a suspicious transaction arise, lawyers should ascertain the purpose of the transaction, the origin and ultimate destination of the funds and the identity of the ultimate beneficiary. They should then submit a report to the FIU documenting their findings. The Act defines a suspicious transaction as a complex, unusually large business transaction or a pattern of transactions which have no apparent economic lawful purpose.

Furthermore, law firms shall appoint a compliance officer within their organisation to ensure that they are meeting their legislative obligations.

Additionally, the Act designates the Financial Intelligence Unit (FIU), which operates within the Ministry of Finance, as the primary authority responsible for handling suspicious reports. The Act also empowers the FIU to issue anti-money laundering guidelines to reporting entities and to impose a range of civil sanctions for entities that breach their AML obligations.

According to Dr. Singh, the Act brings Guyana’s anti-money laundering framework in line with international standards.

A text of the Act is currently not available online.

Sources:

Press release by the Government Information Agency of Guyana on 18 August 2009

 

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03/08/2009: Monaco Enacts New AML Legislation.

On 30 July 2009, the Parliament in Monaco passed a new law – Law No. 862 on Money Laundering, Financing of Terrorism and Corruption, which brings its anti-money laundering law into conformity with international standards.

All anti-money laundering provisions are now consolidated within a single piece of legislation.

A prominent feature of the law consolidates customer due diligence obligations imposed on “designated players”. These include lawyers, accountants, notaries, insurers and high-end traders. Such obligations primarily revolve around identifying the identity of the customer and its beneficial owner, monitoring and keeping records of transactions with the customer and reporting suspicious transactions to the relevant authorities.

Other provisions stipulate circumstances which would give rise to enhanced or simplified due diligence obligations. A cap of EUR 30,000 on all cash payments has also been introduced.

According to the news agency Agence France-Presse (AFP), Monaco’s Finance Minister Sophie Thévenoux said that the law was enacted following the recommendations of the latest Mutual Evaluation Report co-published by the inter-governmental Financial Action Task Force (FATF) and the Council of Europe’s anti-money laundering body MONEYVAL in December 2007.

Additionally, this piece of legislation formally designates the Service d’Information et de Contrôle sur les Circuits Financiers (Information and Financial Channels Control Service  – SICCFIN) as the national financial intelligence unit responsible for investigating reports of suspicious transactions.

For the full text of the law, please click here (French only).

Sources:

Monaco Adopts New Rules Against Money-laundering - Officials, by AFP, as reproduced by Nasdaq.

 

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