Money Laundering/Diligence Checks

Question 1

Describe the term money laundering

Answer 1

When proceeds of criminal activities are disguised or converted and then realised as legitimate assets

Question 2

Which act covers Money Laundering?

Answer 2

Money Laundering, Terrorist Financing and Transfer of Funds Regulations, 2019 Eff Jan 2020 (MLR, 2019) In Both UK and abroad

Proceeds of Crime Act 2002 (CAA) offences

Question 3

Which RICS document covers Money Laundering?

Answer 3

Countering Bribery and Corruption, Money Laundering and Terrorist Financing 1st edition 2019

Question 4

What must you do to ensure compliance with MLR?

Answer 4

1) Ensure MLR policies are updated regularly
2) CDD and EDD for PEP
3) AML checks on funds
4)

Question 5

Name a few requirements under MLR?

Answer 5

• Firms must register with HMRC annually
  
  • Limit of 10,000 euros for acceptance in cash
  • Monitor ongoing business relationship
  • A nominated person must be appointed to report any suspicions to the National Crime Agency
  • Maintain records for a minimum of 5 years

Question 6

CAA

Name the offences under the Crime Proceeds Act 2002?

Answer 6

3 MAIN AREAS OF OFFENCE Under Proceeds of Crime Act 2002 (CAA)
1) Concealing criminal property
○ If a person conceals, disguises, converts or transfers criminal property
2) Arrangements
○ If a person enters or becomes concerned in an arrangement which they know or suspect facilitates the acquisition, retention, use or control of criminal property by or on behalf of another person
3) Acquisition use and possession
If a person acquires, uses or has possession of criminal property

Question 7

Name penalties under the CA 2002

Answer 7

1) Assisting - Max 14 years prison sentence and or unlimited fine
2) Failure to report - Max 5 years prison sentence and or unlimited fine for tipping off a person by informing them they are under suspicion

Question 8

Can you name any Money Laundering Red Flags?

Answer 8

• Cash-only buyers
• An unusual sale price (too low or too high)
• Payments from multiple/different source to counterparty
• Funds provided by unknown third parties

Question 9

Can you rely on someone else’s due diligence ?

Answer 9

No it is your responsibility to ensure the checks are suitable and sufficient.

Question 10

CDD, EDD for PEP

Describe levels of due diligence required under MLR

Answer 10

Customer Due Diligence [CDD]
Independent source of identification
Passport/driving licence
Bank statement, credit card bill council tax statement

Enhanced Due Diligence [EDD]
Politically Exposed Person - someone very influential, more at risk to taking bribes

Question 11

Who is the money laundering officer in your organisation? Who would you report it to?

Answer 11

Toby Nerval - Chief Financial Officer.
Report issues to line manager

Question 12

What are the typical requirements for due Customer Due Diligence checks?

Answer 12

1) Public Limited Company
London Stock Exchange Listing
2) Publicly Accountable Body
Government Ownership / Control
3) Private Limited Company
Certification of incorporation, full name, registered number and office, business address, name of all directors and names of all shareholder with 25% or more
4) Private Individual
Copy of:
Passport or driving licence
Bank statement, credit card bill
Council tax statement or utility bill to show proof of address (not more than 3 months old)