Chapter 8 - money laundering Flashcards

1
Q

What is placement in money laundering

A

Moving the money into a legitimate financial system, such as a bank account

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2
Q

What is layering in money laundering

A

Creating a complex web of transactions to move money around the financial system

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3
Q

What is integration in money laundering

A

Integrating illegal funds back into the legitimate financial system, such as by investing in property or other assets

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4
Q

What does POCA stand for and set out?

A

Proceeds of crime act 2002
sets out principle money laundering offences and requirements

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5
Q

What does TA stand for and do?

A

Terrorism act 2000
sets out principle terrorist financing offences

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6
Q

What does MLR stand for and do?

A

Money laundering and terrorist finance regulations 2020
More detailed rules including what accountants should do with money laundering

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7
Q

What is the punishment for money laundering?

A

Unlimited fine and/or a prison sentence of up to 14 years

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8
Q

What is the punishment for terrorist financing?

A

Unlimited fine and/or a prison sentence of up to 14 years

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9
Q

What are the two circumstances when a required disclosure must be made in an internal report or an SAR?

A

When the accountant wishes to provide services that are in relation to property which is known or suspected to relate to money laundering
When the accountant knows or suspects that another person is engaged in money laundering or terrorist financing

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10
Q

What are the four minimum points an SAR must contain?

A

Identity of the suspected person like name and DOB
Information on which the suspicion of money laundering is based
The whereabouts of the laundered property
Details of the person making the report

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11
Q

What is a protected disclosure?

A

When a required disclosure is submitted, this protects the person against allegations of a confidentiality breach

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12
Q

What is an authorised disclosure?

A

When anyone realises they may have engaged or about to engage in money laundering, this provides them with a defence against money laundering charges

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13
Q

What is concealing in money laundering?

A

Concealing or disgusing criminal property

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14
Q

What is arrangement in money laundering

A

When a person enters into an arrangement which they know or susepcts faciliates the acquisition of criminal property

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15
Q

What is acquisition in money laundering?

A

If a person aquires or has use of criminal property

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16
Q

What is the penalty for failure to disclose?

A

five years in prison and/or a fine

17
Q

what is the penalty for tipping off

A

five years in prison and/or a fine

18
Q

What is CDD and what does it stand for

A

Customer due diligence
this is when the accountant investigates a client to see if they might be involved in money laundering or terrorist financing

19
Q

What three main things should CDD include?

A

Verifying the clients identity by looking at documents and other data
Understanding who the beneficial owners of a business are (owns more than 25%)
What the client wants from the relationship or transaction