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How to establish an anti-money laundering policy for your business

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First4Lawyers, July 09, 2018

If your business comes under the government’s Money Laundering Regulations 2007, it needs to have an anti-money laundering policy in place. If you need help with your policy, whether you want to write a new one or check an existing document, there are certain details you need to think about.

Money laundering is the process of hiding the origins of illegally obtained money, potentially by using it as part of a legitimate transaction. If a business is found to be laundering money, the consequences can be severe.

What to write in an anti-money laundering policy

An anti-money laundering policy must make clear what is expected of staff, who the policy covers, and actions that need to be carried out.

It must ensure everyone who reads it understands what money laundering is so that they can act against it.

The general layout should include:

Introduction

Your document should explain if the company is included under The Money Laundering Regulations 2007 and explain the aims of the policy.

Policy scope

This should cover who must follow the policy and regulations.

What is money laundering?

This section should explain what money laundering is, explaining in plain English combined with official definitions. It should also explain why it is illegal, and why employees must be diligent in protecting against it.

Requirements of the legislation

This section should summarise what is expected of businesses in an anti-money laundering policy, such as appointing a reporting officer, and so on.

Money laundering reporting officer

As the document should serve as educational and as a place of referral, this section should explain who the businesses’ reporting officer is, how they can be contacted, and who should be contacted if the officer is absent or unreachable. This must always be up to date.

Customer due diligence

A company must ensure a customer is who they say they are before a transaction even takes place. This can be done by checking legal photographic identification, statements, and places of residence.

This section should cover why this due diligence is required, and how to carry it out.

How to report suspected money laundering

This will be detailed. It should include how to report anything suspicious to the reporting officer, and how to write up a full case of the suspicious activity.

The guide should be written clearly in step-by-step directions, telling the reader how to safely and securely write the report.

It is also important to make clear that the employee should not investigate the case further as this could be dangerous and implicate them in the scheme.

The actions of the reporting officer

Similarly to the above, this should explain step-by-step the actions the company’s reporting officer will take before deciding whether to push the case onto higher regulating bodies.

Training and further steps

The document should finish by explaining any training that employees should expect to take, the positions that require training and how they will be notified about it.

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