HM Treasury
Economic crime levy - HM Treasury publishes consultation - July 2020
HM Treasury has published a Consultation Paper setting out its proposals for the introduction of an economic crime levy to fund the tackling of money laundering and to help delivery of the government’s 2019 economic crime plan. The levy aims to raise approximately £100 million per year from entities regulated for anti-money laundering (AML) purposes.
In particular, the consultation seeks views on what the levy will pay for, and how it should be collected, calculated and distributed across the AML regulated sector. The consultation also includes a call for evidence on current levels of private sector investment on counter-fraud measures as well as gauging private sector views on contributions towards funding the fraud response.
The consultation invites views on the design principles of the levy, and how it could operate in practice to ensure that it is proportionate and effective. The consultation period closes on 14 October 2020.
HM Treasury consultation on introducing an economic crime levy to fund AML action
Webpage
Financial Conduct Authority
Transposition of 5MLD - HM Treasury and HMRC publish outcome of its consultation on extending the Trust Registration Service - 15 July 2020
HM Treasury and HM Revenue & Customs (HMRC) have published a document clarifying the outcome of its consultation of January 2020 on changes to the Trust Registration Service to comply with the Fifth Money Laundering Directive (EU) 2018/843 (5MLD). HM Treasury and HMRC have also published draft Regulations amending the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (SI 2017/692) (MLRs 2017).
Among other things, the document and Schedule 3A of the draft Regulations clarify the types of trust that will be out of scope for registration, including information on the status of: (i) charitable trusts; (ii) pilot trusts; (iii) will trusts wound up within two years; (iv) share incentive schemes; and (v) bare trusts. The document also confirms that:
- non-UK trusts entering into a business relationship with an obliged entity will only be required to register if the trust has at least one UK-resident trustee. Therefore, non-UK trusts will not be required to register if their only link to the UK is through a business relationship with a UK-based advisor; and
- the government intends to proceed with the penalty regime as consulted on and that it will publish accompanying guidance in due course.
HM Treasury and HMRC summary of responses to its consultation on extending the Trust Registration Service to comply with the 5MLD
Webpage
Recent Cases
Case C-549/18 European Commission v Romania and Case C-550/18 European Commission v Ireland, 16 July 2020
Imposition of financial penalties - failing to transpose the Fourth Money Laundering Directive (EU) 2015/849 (4MLD)
The European Court of Justice (Grand Chamber) (ECJ) has delivered two separate rulings following applications brought by the European Commission concerning infringement action against Ireland and Romania for failing to transpose the Fourth Money Laundering Directive (EU) 2015/849 (4MLD) by the 26 June 2017 deadline. Pursuant to Article 260(3) of the Treaty on the Functioning of the European Union (TFEU), the Commission asked the ECJ to impose financial penalties on both Ireland and Romania, including the payment of a lump sum proportionate to the length of the continuing infringement.
Among other things, Ireland and Romania argued that the Commission’s powers under Article 260(3) of the TFEU did not apply as it had not provided detailed statements of the reasons for its decisions, and that they had eventually fulfilled their obligations under Article 67 of 4MLD.
The ECJ held that both Ireland and Romania had not adopted all the measures necessary to ensure that 4MLD was transposed or that such measures were notified to the Commission, and therefore imposed a lump sum penalty of €2 million on Ireland and €3 million on Romania.
Case C-549/18 European Commission v Romania
Case C-550/18 European Commission v Ireland
