Update

Financial Crime

	Home Office consultation document:   The Proceeds of Crime Act 2002, Obligations to Report Money Laundering: The Consent Regime

As some of you may be aware, the Home Office published, just before Christmas, a consultation document (condoc) on the POCA consent regime:   The Proceeds of Crime Act 2002, Obligations to Report Money Laundering: The Consent Regime . Click here to see further information.

The condoc essentially contains three options:

•  Option 1: Build on the current system

"Under this option, the regime would continue to evolve under the pragmatic approach currently developed by the reporters, law enforcement and prosecutors. Just as with the tackling of the length of time taken to process consent request and the clarification of various issues via court rulings and guidance, we can seek to come up with a workable approach to the issue of fungibility."

• Option 2: Pre-event notification / interim order to restraint assets

"This option is based on a ‘twin track approach'. Institutions would have the choice of freezing a transaction and asking for consent, as with the current regime, or alternatively, could obtain a defence against money laundering by filing a Pre Event Notification (“PEN”). Under a PEN there would be no obligation to freeze any transaction while awaiting consent. A broadened restraint provisions in POCA would also be created to enable law enforcement to freeze activity on the authorisation of a senior officer (e.g. ACPO rank), and on the basis that a court order would be obtained within 72 hours."

•  Option 3 (refinement to Options 1 and 2 rather than free-standing option): Entrenching the 'course of conduct' approach to reporting in statute

"In this option, instead of requiring a specific report to be made to provide a defence against every single act of money laundering, however technical, the legislation could be amended to provide a broad defence when the reporting institution had made sufficient disclosures to give SOCA a “reasonable picture” of the criminal activity.'"

We shall be discussing the FOA's response to this consultation at future AML Committee meetings. However, we would appreciate, in particular, members' views on: 

(a) the options set out in the condoc; and

(b) the argumentation (where possible substantiated) which we should include to support our response.

Members wishing to provide feedback should email Jane Green as soon as possible.

	UK Sanctions Regime roundtable

The FOA organized a UK Sanctions Regime Roundtable for members of the AML Committee and AML contacts at regulated firms, which was held on Wednesday, 20th February, 15:30 - 17:30, and hosted courtesy of Morgan Stanley at their offices at 20 Cabot Square, London E14 4QA.

Representatives from HM Treasury, the FSA and Law Enforcement have kindly agreed to participate: following introductory presentations, the representatives will be discussing a number of interesting questions pre-submitted by AML Committee members. Time permitting, there should also be an opportunity to raise other issues and concerns.

	US Foreign Corrupt Practices Act

Recent enforcement actions by the United States Government make it clear that the Foreign Corrupt Practices Act (FCPA) should remain firmly at the top of the agenda for all firms accessing U.S. capital markets or conducting business in the U.S.

In addition to recent enforcement efforts against European companies and executives, FCPA trends include significantly heightened monetary penalties and compliance monitors. As anti-corruption and FCPA compliance programmes continually develop, corporate risk managers must pay particular attention to due diligence on acquisitions in emerging markets, use of intermediaries as consultants to conduct business in Third World geographies, training, discipline and many other aspects of compliance.

At our first Compliance forum of 2008, members of Mayer Brown's White Collar Defence and Compliance group (which include a number of former senior U.S. federal prosecutors and SEC enforcement attorneys) updated members on the most recent enforcement activity at the U.S. Department of Justice and the SEC and provided an overview of developing international anti-corruption regimes. Time and the detailed nature of this topic did not, however, permit a discussion re compliance programmes; if, therefore, you would be interested in a follow-up event to focus on the practical issues, please contact Jane Green .