Anti-money laundering反洗钱

.Money laundering, means helping to unlawfully justify the origin of goods or revenues from the author of a crime (bank robbery for example) or
misdemeanour (tax fraud), or the fact of contributing to a placement, layering, or conversion operation related directly or indirectly to a crime or an offence.

. Goods or revenues are presumed to be the product of a crime or an offence when the material, legal, or financial conditions from the placement,
concealment, or conversion operation can have no other justification than concealing the origin or the beneficial owner of these goods or revenues.

 

Money laundering is therefore a consequential offence, which
cannot be constituted被算作 without the presence of a prior offence that has generated illicit非法的 income (dirty money). To allow money
laundering is to allow criminals to enjoy the fruit of their crimes and felonies!

Globally, dirty money represents 2 to 5% of theglobal GDP,almost 1.6 to 4,000 billion euros!

 

Animal trafficking Animal trafficking
Drug trafficking 
Trafficking in works of art 贩卖艺术品
lnsider trading 内幕交易

Fraud 欺诈
Human trafficking 人口贩运
Tax fraud 税务欺诈
smuggling 走私

 

Manufacture of 制造 counterfeit money 假币
counterfeiting 伪造
corruption
cybercrime 网络犯罪
Abuse of corporate
Arms trafficking 武器贩运

 

The money laundering
Definition
1.Placement

lntegration into the financial system

This is usually the initial stage in which moneylaunderers introduce the proceeds收入 from their crimes and offences into the financial system.
To do so, they can divide big sums into small sums that they transfer directly to an account.
They can also purchase a number of financial products, bonds债券, travellers' cheques支票 or insurance policies.

2. layering

Layering to international and offshore banks
Loss of trace of the origin of funds

The criminals attempt to make it difficult to trace the source of funds through a series of transactions using the illicit funds.
The funds can be transferred across accounts from different banks,or investment products can be bought or sold.
In certain cases, Layering can involve the transfer of money through payment for goods or services, which makes them appear legitimate.

3.Integration

Purchase of luxury products and lnvestment

If the money laundering process is successful, the money can be used freely by the criminals.
So, if we allow this company to exchange its dirty money for our gift cards without verifying the origin of its funds, we could be prosecuted起诉，控告 for money laundering.
We must thus pay close attention to the origin of funds and to our clients' motivations!

 

The terrorist financing

Although money laundering and terrorist financing have characteristics in common, their execution is different.

In the case of money laundering, the focus is on the origin of the funds, while in terrorist financing, the focus is on their use.

Terrorist fnancing can thus be defined as the act of providing values, goods or services  such as advice or expertise专业知识 with the intent of commit terrorist acts.

In both cases, secrecy and mobility are critical, it is generally not necessary, in terrorist financing, to go through a concealment stage before reaching the stage where the funds will be used.

 

Since 1990, specific measures aimed at combating terrorist financing have been put in place.

They mainly consist of reconciling, generally digitally,lists of known terrorists with the names of originators or beneficiaries of international transfers or bank account holders.

This procedure is called“asset freeze”since it allows, in case of identifcation, freezing the assets of the person or entity concerned.

Non-compliance with the asset freeze is punishable by 5 years in prison, confiscation没收，充公，征用;
of property and assets that are direct or indirect proceeds of the offence, and a general penalty from at least the same amount or at most twice the amount to which the penalty has been applied.

Legal persons incur a higher penalty (x5).

 

Other specific measures related to counter-terrorist fnancing may especially take into account the engagement in operations，with countries identifned as countries of risk: such as Iran, Sudan, North Korea, or Cuba
but also the nature of the operation, like the sale of weapons, nuclear, or diamonds from Sierra Leone塞拉利昂共和国

The fact of not being able to justify resources corresponding to lifestyle, while maintaining regular relations with a person engaged in one of the acts referred to, is punishable by seven years of imprisonment and a 100,000 euros penalty.

 

Terrorist financing
●It is the act of providing funds, directly or indirectly, with the intention of seeing them used, or knowing they will be used. in
whole or in part, to commit crimes related to terrorism

Terrorism
●Any act destined to kill or harm a civilian to intimidate a population or force a government to perform certain acts

Proof of terrorist financing
●The sole fact of not being able to justify resources corresponding to lifestyle, while taking part in regular relations with one or
more individuals engaging in one or more acts considered to be terrorist acts, may be punishable as an act of terrorist financing.

Characterisation of a context of risk
●Public regulatory entities make available to regulated actors certain lists of countries, activities, and individuals of risk, with
whom we cannot work (under penalty of sanctions), or that require us to conduct additional due diligence to ensure the quality of our clients (risk assessment).

In this case, it is crucial to know how to identify the potential uses of funds that we make available to its clients via its products.

 

BEFORE ENTERING THE BUSINESS RELATIONSHIP
International sanction制裁 and Embargoes禁止贸易令;
It is forbidden to grant access to regulated products to clients coming from countries under embargo, performing activities subject to international sanctions, or whose name is included in one of the lists of persons considered to present a risk by international bodies.
These lists are issued by the UN or from EU or US community regulations(OFAC).
That is why it is fundamental to identify our clients and check interdiction lists before entering into any business relationship.

 

AFTER ENTERING THE BUSINESS RELATIONSHIP
Asset freeze
It is forbidden to transfer, convert, or dispose of any asset as a result of a measure taken by a competent authority in the context of a freeze procedure.
In all cases, frozen assets remain the property of the natural or legal person's holding an interest in said assets at the time of the freeze.
If existing clients are included in risk lists (due to their identity, activity, or nationality), their assets should be frozen without prior notice and you should inform the Compliance Department of your BU

 

ACTIVITIES WITH INTERNATIONAL SANCTIONS
SALE OF WEAPONS
NUCLEAR
DIAMONDS FROM SIERRA LEONE

 

HIGH-RISK AND EMBARGOED COUNTRIES/REGIONS

 

Our products and associated risks

 The risk of money laundering associated with a product should be evaluated, beyond whether it is regulated or not, according to its attributes.

1. The diversion of our products cannot be excluded
Illustrations of the use of our products for money laundering

2. Understanding product use and associated risks
Reminder of the 3 product families
Families of more or less risky products

An assessment to be made in practice, beyond simple product attributes, is the risk-based approach (it will be presented in the next section).

 

EMPLOYEE BENEFITS
More than 110 programs:
Meals and food
Well-being
Culture

Employee benefits represent the largest part of our business globally.
The risk of money laundering or terroris financing via these products is low because they are only accepted for the payment of
specified goods and services.
Besides, they often have a favourable legal or fiscal财政的 framework aimed at encouraging virtuous有道德的 behaviours (food, education, ecologies).
These uses are hardly susceptible to being diverted for criminal purposes.

 

PROFESSIONAL MOBILITY SOLUTIONS
More than 80 programs:
Fuel cards
Toll通行费 and parking service
VAT reimbursement
Maintenance

In certain countries, these solutions can be considered regulated.
However, the use of funds intended for professional mobility is in principle intended to be performed through partner brands in order to purchase specified goods and services
The terrorist financing risk associated with these solutions is usually regarded as low.
However, it should be ensured that the product characteristics cannot be diverted through uses favourable to money laundering (purchase of cards, then a reimbursement补偿 request).

 

COMPLEMENTARY SOLUTIONS
More than 60 programs:
Business payment services
Incentives and rewards
Public and social programs

In some countries, these solutions can be considered regulated.
Thus in Europe, the Payment Services Directive requires, with some exceptions, obtaining an approval to be able to issue associated products (issuers of electronic money).
The risk of money laundering is moderate and it requires following the Know Your Costumer procedure as well as a careful risk analysis.
In fact, our payment services and social programs provide access to unmarked money (universal gift card, social aids), which can be used to finance terrorism.

 

Examples of Product risk indicators
Before marketing a product, its main characteristics should be taken into account to evaluate the associated risk level and establish the anti-money laundering and counter-terrorist financing measures to be taken.
There are more and less risky product families, and in practice, certain attributes require more attention when it comes to potential diversions:

1Anonymity: a product that can be used anonymously presents more risks as it can be more easily diverted for criminal purposes.
2Possibility to withdraw cash: a product that allows withdrawing cash without verifying its use presents a high level of risk.
3Possibility to make transfers from person to person: a product that authorises transfers from person to person does not allow validating the identity of the individual that will use it. This can facilitate illicit use.
4High level of authorised transaction: a product that allows high card limits and a high amount per transaction is more likely to attract interest among fraudsters.

 

The methods of combat

These are three main pillars of AML-CFT at our company:

Knowing the customer
Monitoring transactions
Monitoring the beneficiaries

The role played by sales representatives, particularly when it comes to knowing the clients, is fundamental to the proper functioning of the procedures put in place by us.

 

How we scores the level of risk of its activities

Country risk
Does the country where I provide my services present specific risk profiles?
●Weak AML-CFT* regulatory frameworks of light supervision
●High rate of criminal activity and strong presence of criminal organisations
●Tax havens

 

Distribution risk
Is my distribution channel appealing for money laundering or terrorist financing?
●Remote or face to face sale
●Intermediaries(who are not regulated entities)

 

Risk for the customer
Are there any reasons to believe that the customer could engage in money laundering or terrorist financing?
●High-risk activities: highly corrupted sectors, substantial use of cash, non-profit organisations
●Bad reputation: media refer to them negatively
●Nature and behaviour: doubts about identity. difficulty understanding targets or ownership structure. complex transactions
●Politically exposed and sanctioned individuals

 

Product risk
Is the service I offer attractive to criminals who intend to engage in money laundering or terrorist financing?
●Opacity and anonymity VS.transparency
●Complexity
●High product and transaction value

 

The risk mapping, a local, collaborative and dynamic tool
For each product, a risk map should be drawn up and kept current for each product category.
This study is mandatory for each product of each BU and allows establishing a virtuous circle of continuous strengthening of
control measures, depending on the evolution of customer and product databases. All parties must keep this cartography
current in order to contribute to the effectiveness of the fight against money laundering and terrorist financing.

1- Establishment of the risk map
- Product Team & Compliance
2- Update of products AML risk assessment
- Product Team & Compliance
3- Evolution of client/product databases
- Product Team & Compliance
4- Analysis of anomalies and alerts
- Compliance

 

KYC (Know Your Customer): knowledge of the customer by our company
The KYC, Know Your Customer, is the name of the process that allows to verifying the identity of a company's clients at the start
of the relationship and throughout the entire relationship.
It is one of the pillars in the prevention of identity theft, tax fraud, money laundering. and terrorist financing.
It also allows "banking type" entities to ensure compliance with the various international sanctions by having an updated knowledge of their business customers, associations, collectives, (... and natural persons.

 

Training for compliance officer

our commitment to the fight against money laundering and terrorist financing

As members of the Company Group, we are committed to doing everything in our powerto ensure the legal exercise of our activities.
The credibility可信性; 可靠性; of our brand image and the sustainability可持续性 of our activity depend on thiscommitment.

A pillar of Company's strong compliance culture, this training will help you consolidate巩固 and put into practice your knowledges and skills in the fight against money laundering and terrorist financing. lt will introduce key concepts, adapted to our products, regulated or not, that will allow you to respond to the risks of money laundering and terrorist financing to which we may be exposed on a daily basis.

 

The AML-CFT regulations and supervisory authorities
Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT)

欧洲联盟理事会（英语：Council of the European Union），简称欧盟理事会，是欧洲联盟事实上的两院制立法机关上议院，由来自27个欧盟成员国各国政府部长所组成的理事会；与欧洲议会同为欧盟的主要决策机构。

欧洲议会（英语：European Parliament）是欧洲联盟事实上的两院制立法机关的下议院，唯一的一个直选议会机构；与欧盟理事会同为欧盟的主要决策机构。

欧洲联盟委员会（英语：European Commission；法语：Commission européenne；德语：Europäische Kommission；意大利语：Commissione Europea），简称欧盟委员会，是欧洲联盟下辖的一个超国家机关，为欧盟事实上的内阁。在欧盟政治系统中，欧洲委员会主要工作为负责执行欧洲议会和欧盟理事会的决议、提出欧洲法案和维护《欧洲联盟条约》。^[2]欧洲委员会由27位执委组成，执委须在位于卢森堡市的欧洲法院宣誓就职。^[3]

The normative mechanism
The European Commission draws up and adopts the regulatory proposals that it submits to the EU Council and the European Assembly.
Our Public Affairs teams are involved in the process of developing these regulations.

 

The fight against money launderingand terrorist financing is one of theEuropean Union's main supervisorypriorities.
The regulatory mechanism is vast and tends to solidify and harmonise with a superposition of guidelines.

 

2015

4th Anti-money laundering directive
Redefinition of beneficial owners
Reduction of cash payment thresholds
lndependence of Financial lntelligence Unit(FIU)
Strengthening of the risk-based approach
Application of the AML-CFT mechanism toelectronic money products
Harmonisation of applicable administrativesanctions
Designation of a permanent representative for payment and electronic money institutions.

 

2018

5th Anti-money laundering directive
Extension of the AML-CFT to crypto-assets
Strengthening of vigilance measures regarding high-riskthird countries
Creation of a unique identification list of politically exposed persons
Strengthening European and international cooperation
Strengthening the transparency of information on beneficial owners
Strengthening of electronic money monitoring.

 

2020

6th Anti-money laundering directiyve
Entry into force in December 2020 and applicable from June 2027
Harmonised definition of money laundering
List of 22 infractions constituting money laundering and minimum sentence(years)
Alignment of the sanctions for complicity in money laundering with those of money laundering
Extension of criminal liability to legal persons directly liable for money laundering
Mandatory criminalisation of terrorism, drug trafficking, human trafficking.sexual exploitation. racketeering. and corruption.

 

 

Supervisory authorities

Competent authorities

 

LOCAL REGULATORS
1.lndependent administrative authorities from local governments (FCA(UK).ACPR(FR),FSMA(BE).BaFin (GE), etc.) brought together under the authority of the European Banking Authority (EBA)
2.Grant approvals and licences to operate tobanking institutions
3.Ensure compliance with regulations andevaluate their monitoring mechanisms
4.Sanctions:
administrative sanction
monetary sanction

 

LOCAL FINANCE MINISTRY
Public body responsible for state financialresources
Collect tax revenues
The funds of persons subject to sanctions(particularly asset freeze measures) are redirected to the treasury.

 

LOCAL FINANCIAL INTELLIGENCE UNIT
Unit created in 1990,linked to the Ministry of Economy and Finance
Collects, analyses, and enriches suspicious activity reports on professions subject to suspicion
Establishes the presumption of money laundering or terrorist financing
sends the files to the Public Prosecutor公诉人; 检察官; 原告律师; 控方律师;

 

FINANCIAL ACTION TASK FORCE(FATF)
lntergovernmental entity created in 1989
Development of standards and promotion of legislative, regulatory,and operational measures regarding the AML-CFT
Policy recommendations to ensure market integrity
Publication of a list of countries at risk regarding AML-CFT (for example, tax havens)

 

The reporting obligations for Company and its employees

 

作者:Chuck Lu    GitHub