- July 24, 2018
- Posted by: FinancialCrimeServices
- Category: Uncategorized
On the 19th April 2018, the European Parliament adopted the 5th Anti Money Laundering Directive. The Directive has been formally endorsed by the European Council and the text has been published in the Official Journal of the European Union on the 19th June 2018. Member States will be required to bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 10 January 2020. Here we outline:
Entities that now fall under the Directive
• The following obligated entities have been brought into the scope of the new Directive:
• Virtual currency providers and custodian wallet providers;
• Art traders (when the value of transactions or series of linked transactions amount to EUR10,000 or more);
• Those who provide similar services to auditors, external accountants and tax advisors as a principal business or professional activity; and
• Estate agents who act as intermediaries in the letting of property where the monthly rent is equivalent to EUR10,000 or more.
• Non-reloadable payment instruments that have a maximum monthly payment transaction limit of EUR150 and where the maximum amount stored electronically exceeds EUR150, are now subject to customer due diligence (CDD) measures. The threshold has been reduced from EUR250 to EUR150.
• Remote payment transactions that exceed EUR50 are now subject to customer due diligence measures. The threshold has been reduced from EUR100 to EUR50.
• Each member state and any international organisations accredited to it will be required to keep an up to date list of exact functions which qualify as prominent public functions. A single list of all prominent public functions will be assembled by the Commission and will be made public.
• Identification and verification of customers must be based on documents, data or information from a reliable and independent source. The proposed amendment now states that where available, this should also include electronic identification means that have been approved by national authorities.
Enhanced due diligence
• A new Article has been created which aims to standardise the enhanced due diligence (EDD) measures which obligated entities across member states should apply to business relationships with high risk third countries. Currently, member states determine their own type of EDD measures that should be applied towards high risk countries.
Beneficial ownership registers
• Any member of the public can now have access to beneficial ownership information held in the register for corporate and other legal entities. Access is no longer limited to persons who can demonstrate legitimate interests.
• Centralised automated mechanisms, such as central registries or central electronic data retrieval systems, will allow FIUs and competent authorities to identify account holders in a timely manner.
• FIUs will now have the ability to acquire any information they need from any obliged entity, even without a previous suspicious transaction report being made.