Contentious Trust and Probate Quarterly Round-Up: Q2 2020
The European Commission presented an Action Plan this week to strengthen the fight against terrorist financing. The plan underlines how the adoption of the Fourth Anti-Money Laundering Package represented a significant step in improving the effectiveness of the EU's efforts to combat the laundering of money from criminal activities and to counter the financing of terrorist activities. That said the Commission is now calling on national governments to take action earlier than planned to put national rules in place by end December 2016 rather than end of June 2017.
In addition the Commission stated that it would propose a number of “targeted” amendments to the Fourth Anti-Money Laundering Directive confirming it would do this “at the latest” by the end of the second quarter of 2016.
The amendments to be proposed include:
A list of all due diligence measures that financial institutions should carry out on financial flows from countries having strategic deficiencies in their national anti-money laundering and terrorist financing regimes. Focusing on high-risk non-EU countries. Widening the scope of information accessible by the Financial Intelligence Unit to include giving them easier and faster access to information on holders of bank and payment accounts through centralized registers or electronic data retrieval systems at national level.
In addition, virtual currencies will be brought under the scope of the anti-money laundering regime, so that these platforms have to apply customer due diligence when exchanging – for example Bitcoin – for real currencies. Customer verification requirements for pre-paid cards will also be lowered. A legislative proposal on illicit cash movements will be brought forward to extend current provisions, to now include cash shipped by freight or post and to allow authorities to act upon lower amounts of cash where there are suspicions of illicit activity.
Improvements in asset freezing are also on the agenda with the Commission due to assess the need for a specific EU regime for freezing of terrorist assets in addition to UN asset freezing measures.
Finally, the Commission highlights how whilst all EU Member States have criminalised money laundering there are differences as to the definition of money laundering and the sanctions applied. The Commission argues that these differences create obstacles in cross-border judicial and police cooperation to tackle money laundering, and have a direct relevance to action against terrorist financing. Therefore a series of minimum rules regarding the definition of the criminal offence of money laundering (applying it to terrorist offences and other serious criminal offences) and to approximate sanctions will be proposed.
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