UK Treasury consults on EU anti-money laundering reform

The Treasury has opened a new consultation into the UK’s implementation of new EU anti-money laundering (AML) laws.

UK.- The Treasury has opened a new consultation into the UK’s implementation of new EU anti-money laundering (AML) laws (84-page / 734KB PDF). The Fourth Anti-Money Laundering Directive (MLD4) came into force on 25 June and EU countries have until 26 June 2017 to introduce national legislation following the directive.

The directive expands the existing regime to include all gambling providers rather than just casino operators, which is currently the case. Providers of gambling physical and remote gambling services may be exempted from some or all of the directive if their activities are low risk. The Treasury has asked respondents to give their views on the money laundering and terrorist financing risks in certain sectors of the gambling industry and in the different gambling services providers offer.

“Following assessment of the evidence provided to us through this consultation, the government will exempt only gambling providers which are proven low risk,” the Treasury said. If, for example, the UK makes no changes to the Regulations in relation to gambling and so it continues only to regulate casinos, such a “decision would need a very strong evidence base since the directive requires member states to explain their conclusions to the [European] Commission who will share this with other member states. An exemption and explanation is also susceptible to the scrutiny of the courts.”

Casinos, on the other hand, cannot be exempted from the AML rules under the terms of the EU directive. Providers of gambling services that are not exempt will need to comply with the CDD measures when establishing a business relationship; on the collection of winnings or placing of a stake or both and when any transaction amounts to €2,000 (£1,672) or more, whether the transaction is in a single operation or several that appear linked.

In addition, gambling service providers must also apply CDD where there is a suspicion of money laundering or terrorist financing despite there being any derogation, exemption or threshold and when there are doubts about the accuracy or adequacy of customer identification information.