The FCA (Financial conduct Authority) has just imposed a fine of £4.2 million on EFG Private Bank (a reduction of 30%) after finding that the Bank's AML (anti-money laundering) compliance systems were lacking.
This follows the recent BBC Panorama programme which alleged that £35 million of stolen funds from the Russian Treasury (the Magnitsky probe led by the brave and determined Bill Browder) were laundered through ten UK registered front companies. A full report is currently being considered by City of London Police and SOCA.
The Austrians also point fingers at the UK, having come under pressure like Luxembourg to relax their banking secrecy laws, saying that they will only do so when the UK cleans up their offshore tax havens in the Channel Islands, BVI and the Caymans.
So what is the UK doing about these allegations of industrial money laundering through its companies, banks, and offshore tax facilities?
To be fair, there has been some movement, however slow, to deal with these issues. The SFO and other prosecution authorities are anxiously waiting for DPAs (deferred prosecution agreements) to take effect in 2014 so that they can use them to pursue corporates for money laundering, fraud, bribery and corruption. The UK's Sentencing Council, (under the Chairmanship of LJ Leveson) is drafting a sentencing consultation on DPAs and those related offences, so as to bring some consistency of approach to this issue.
However, all this pales in comparison with the aggressive approach favoured by the US who have spearheaded the international anti-money laundering drive and have 'mopped up' financially as a result, with monumental fines.
FATCA (the US Foreign Account Tax Compliance Act) has been incredibly effective. Banks have fined 30% withholding charge on tax monies due to the IRS that have not been declared by US citizens and it has brought the whole issue of money laundering, and indeed aggressive tax avoidance, to the fore.
So, how can this affect you?
If you are a legal, banking, or finance professional it is very easy, for even for the most cautious of us, to get caught up in money laundering, and the authorities are taking a much tougher stance against those professionals. It is vital to know when to make a SAR (suspicious activity report) and to have the best and well executed AML (anti-money laundering) systems in place.
We are currently advising worried professionals, including those under investigation and corporates who are facing difficulties in this regard. Jeffrey Lewis is our key contact.
Money laundering for the lay individual is also providing to be something of a headache, not just in terms of conducting business but also those who are having cash monies seized and restrained.
We have years of unparalled success when dealing with these issues. Contact Jeffrey Lewis.
