The Law Commission is reviewing the anti-money laundering regime in Part 7 of the Proceeds of Crime Act 2002 and the counter-terrorism financing regime in Part 3 of the Terrorism Act 2000, in order to make the consent regime more effective
The review will focus on the consent provisions in:
- 2002 Act: sections 327 to 329 and sections 335, 336 and 338.
- 2000 Act: sections 21 to 21ZC
The review will also consider the disclosure offences in sections 330 to 333A of the 2002 Act. And sections 19, 21A and 21D of the 2000 Act.
The Commission has now launched a consultation paper which includes the following proposals
- statutory guidance on what to look for and a set format for submitting suspicious activity reports
- asking whether new tools could help enforcement, like US-style Geographic Targeting Orders
- a new power to require additional detail and record keeping requirements targeted at specific transactions
- cutting back on low quality reports by focussing on accounts where there are reasonable grounds to suspect property is criminal property
- legal protection for banks which choose to lock into an account the suspected criminal funds but leave the rest of the account open to trade thereby minimising the risk of severe financial loss for those who are the subject of a disclosure
- providing detail as to what amounts to a defence of ‘reasonable excuse’ for not making a suspicious activity report
- asking whether commercial organisations, rather than the individual employees, should be liable for failure to prevent a criminal offence when an employee fails to disclose a suspicion
It is hoped that these proposals will help banks and businesses provide better information to law enforcement agencies and help refocus attention on the most suspicious activity.
The closing date for the consultation is 5 October 2018.