Chapter 30 Flashcards
What are SARs?
Suspicious Activity Reports
What is suspicion?
- A state of mind more definite than speculation but falling short of evidence-based knowledge
- A positive feeling of actual apprehensions or mistrust
- A slight opinion without sufficient evidence
What is criminal conduct?
Behaviour which constitutes a criminal offence in the UK
In what circumstances is it not necessary to report overseas ML? known as the overseas conduct exemption
- When the conduct is reasonably believed to have taken place overseas
- It was lawful where it took place
- The maximum sentence had it happened in the UK would be less than 12 months
A person doesn’t commit an offence if they make a disclosure to who?
- A fellow relevant employee of the same undertaking
- To a relevant professional adviser
- To an AML supervisory authority as defined by 2017 Regulations
- For the purposes of the prevention, investigation or prosecution of a criminal offence in the UK
- Following notification that the moratorium period for a consent SAR has been extended beyond 31 days
Who has the duty to submit SARs straight to the NCA?
Only Sole practitioners who employ no relevant employees
What is the MLRO responsible for?
For deciding whether:
a) Consent is required from law enforcement for the engagement
b) how client business should be conducted while a consent decision is awaited
When deciding what to do, what should the MLRO consider?
- Do I know or suspect that someone is engaged in MLTF?
- Do I think that someone involved in the activity know or suspected that it was criminal?
- Can I identify the suspect or the whereabouts of any laundered property
- Is an application for consent required?
- Do I believe the contents of the internal SAR will help identify the suspect or the whereabouts of any laundered property?
- Can I provide the information essential to an external SAR?
What information is essential in an external SAR?
- Name of reporter
- Date
- Name of suspect / info that helps identify
- Details of anyone else involved
- Facts regarding what is suspected and why
- Relevant NCA glossary code
- Whereabouts of any criminal property
- The actions the business is taking which require consent
What is recommended to be included in external reporters?
- Don’t include confidential info not required by POCA
- Show the name of the business, individual or MLRO submitting the reports only once
- Don’t include names of relevant employees who made internal SARs
- Include other parties as ‘subjects’ only when the information is necessary
- Highlight clearly any particular concerns the reporter might have about safety
Do you need to make SAR even if the party involved never became a client?
Yes
It is important that adequate records of internal SARs are kept - what must this include?
- All internal SARs made
- How the MLRO handled matters
- Assessments of the information provided
- The rationale for deciding whether of not to make an external SAR
- Any advice given to engagement teams about continued working and any consent requests made
Explain what is meant by the privileged circumstances exemption?
A member cannot submit an SAR if the information can to them in privileged circumstances - eg if their client came to them asking for help on how they disclose this evaded tax.
This is as long as the information wasn’t provided with the intention of advancing a criminal,
What is consent and what should an MLRO do if in doubt whether to require consent?
When preparing to make a SAR, the MLRO must consider whether the business would be making a ML offence if it continues to act for the client - in these cases the NCA may provide a defence against ML in the form of consent for the activity in question.
MLRO should seek legal advice if in doubt
How long must the firm wait before they treat consent as having been given by the NCA and continue working on the client engagement?
7 working days
