December 2019

International

The Financial Action Task Force (FATF)

• FATF Executive Secretary David Lewis delivered his keynote speech which highlights the need for effective implementation, not a tick-box approach, to stop money laundering and reduce the harm caused by crime and terrorism at the 7th International Anti-Money Laundering and Compliance Conference, in Bratislava.
• Updated its consolidated assessment ratings which provides an up-to-date overview of the ratings that assessed countries obtained for effectiveness and technical compliance.

Regional

No major updates this month.

Australia

The Australian Transaction Reports and Analysis Centre (AUSTRAC)

• Reminded the reporting entities to submit their 2019 compliance report to AUSTRAC to demonstrate how their business has met its AML/CTF compliance obligations. Your 2019 compliance report will cover your business activities for the 2019 calendar year and must be submitted by 31 March 2020. If you did not provide a designated service during 2019, you will still need to submit a compliance report.
• Released a suite of new resources to help reporting entities implement strong AML/CTF governance practices in their business.
• Anti-Money Laundering and Counter-Terrorism Financing Rules Amendment Instrument 2019 (No. 3) is now in force with amendments in the following sections:
•  Chapter 11 (Compliance Report – reporting and lodgment periods):  
• The reporting period in paragraph 11.2 is now specified to be “each successive period of 12 months beginning on 1 January and ending on 31 December”, and the lodgment period is specified in paragraph 11.3 to be “the period of 3 months beginning at the end of each successive reporting period”. This would mean that for the 2019 reporting period (being the period from 1 January to 31 December), a reporting entity would be required to submit their Compliance Report between 1 January 2020 and 31 March 2020.
• The drafting of paragraph 11.4 has been simplified, including by removing references to the 2018 and 2019 calendar years, to ensure that annual amendments to the Chapter are no longer required. These amendments are not intended to change the substantive effect of the provisions, but are intended to simplify the drafting to aid readability and clarify reporting entities’ obligations.
• Chapter 51 (AML/CTF Rules relating to certain definitions under the AML/CTF Act - Ordering and Beneficiary Institutions, Financial Institutions and Non-Financiers):
• Part 51.2 of the AML/CTF Rules contains obsolete references to two companies, one of which is no longer operating in Australia and has been deregistered by ASIC (KEB Australia Limited ABN 11 003 095 181), while the other entity (Travelex GBP Australia Pty Limited ABN 24 150 129 749) has changed its legal name (now Western Union Business Solutions (Australia) Pty Ltd). The Rules amend this Part to remove references to the deregistered company and correctly identify the other entity.

New Zealand

No major updates this month.

Hong Kong 

The Hong Kong Monetary Authority (HKMA)

• Provided guidance to authorized institutions (AIs) and stored value facility (SVF) licensees on how to manage ML/TF risks associated with virtual assets (VAs) and virtual asset service providers (VASPs) in relation to recent updates by the FATF to its Recommendation 15, which clarify the businesses and activities that the FATF requirements apply in the case of VAs and VASPs.

The Securities and Futures Commission (SFC)

• Released the recent AML/CTF seminar materials. Licensed corporations and associated entities are encouraged to download the aforesaid presentation materials for reference and internal training as appropriate.

Canada

The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC):

• Posted an operational alert: suspicious casino-related transactions, particularly those involving bank drafts, that are suspected to have roots in underground banking. FINTRAC also published indicators of money laundering through casino-related underground banking.
• Charges laid in money laundering case linked to illegal online cannabis sales. The investigation determined that Moxipay Corporation was operating as an unregistered Money Service Business which is an offence under the Proceeds of Crime, Money Laundering, Terrorist Financing Act. The investigation identified that cannabis dispensaries not federally licensed to produce and/or sell cannabis in Canada, used Moxipay to transfer and receive funds.

United Kingdom

The Law Society of Scotland

• The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 will shortly be amended to take account of changes imposed by the EU’s 5th Money Laundering Directive. The statutory instrument was laid before Parliament on Friday 20 December, and is available to view on the UK Parliament's website. The amended regulations will come into force on 10 January 2020 and firms are expected to take rapid action to ensure compliance.

The Gambling Commission

• Published statement of supervisory expectations on the upcoming Money Laundering Regulations updates that implement the EU 5th Money Laundering Directive on 10 January 2020. The Gambling Commission expects to see that operators have acted promptly, invested appropriately (if technology is required to accommodate the changes) and implemented changes with the requisite urgency. Additionally, publication of the updated guidance on 10 January 2020 must result in casino businesses reviewing, and accordingly amending, their ML/TF assessments, as well as the associated policies, procedures and controls.
• The Financial Conduct Authority (FCA) advises that, from 10 January 2020, it will be the supervisor of UK cryptoasset businesses (in relation to certain cryptoasset activities) for AML/CTF purposes. The Gambling Commission advises its licensed operators to verify whether any business activities (including where cryptoasset money service business facilities are offered to consumers) fall within the scope of the Regulations and are therefore subject to supervision by the FCA.

Singapore

The Monetary Authority of Singapore (MAS)

• Published response to consultation paper on proposed payment services regulations and proposed payment services notices and guidelines.
• Published requirements for payment service providers (other than a digital payment token service provider),  digital payment token service providers, exempt payment service providers and persons providing account issuance services who are exempted under the Payment Services (Exemption for Specified Period) Regulations 2019 during the transition period on anti-money laundering (AML) and countering the financing of terrorism (CFT).
• Published a consultation paper on proposed amendments to the Payment Services Act 2019 in relation to AML/CFT, and other amendments in respect of digital payment token service and certain technical amendments. This consultation closes at 11.59 PM on 28 January 2020.

United States

No major updates this month.

South Africa

The Financial Intelligence Centre (FIC)

• Launched South Africa’s first public private partnership, between the banking sector and government regulatory authorities, aimed at enhancing collaboration and coordination in combating financial crime, money laundering and terrorist financing.
• Issued Public Compliance Communication 41 (PCC 41) dealing with Non-profit Organisations (NPOs). The PCC 41 is aimed at creating awareness within the NPO sector around the vulnerabilities that NPOs face from an anti-money laundering and combating the financing of terrorism perspective. 

Brunei

No major updates this month.

Barbados

No major updates this month.

European Union

The European Supervisory Authorities (ESAs)

• EU’s 5th Money Laundering Directive will come into force on 10 January 2020.
• Published joint guidelines on cooperation and information exchange, establishing colleges of anti-money laundering and countering the financing of terrorism (AML/CFT) supervisors for the first time in the EU to ensure effective cooperation and information exchange between competent authorities. These measures are needed to strengthen the EU's AML/CFT efforts.