Anti Money Laundering Policy - W

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					  Cumbria County Council

Anti-Money Laundering Policy




          March 2008
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Introduction

1 There have been significant changes to the legislation concerning money laundering
  (the Proceeds of Crime Act 2002 and the Money Laundering Regulations 2003), which
  have broadened the definition of money laundering and increased the range of activities
  caught by the statutory framework. As a result, the new obligations now impact on
  areas of local authority business and require local authorities to establish internal
  procedures to prevent the use of their services for money laundering.

Scope of the Policy

2 This policy applies to all Members and staff of the Authority and aims to maintain the
  high standards of conduct which currently exist within the Authority. The policy sets out
  the procedures which must be followed to enable the Authority to comply with its legal
  obligations. Within this policy the term employees refers to all employees and elected
  members.

3 Directors must ensure that all employees are aware of this policy.

What is Money Laundering?

4 In general terms money laundering is the disposal of money from criminal activity on
  legitimate activities, for example, cash obtained from a criminal activity, such as selling
  stolen goods, being spent on the purchase of a vehicle being disposed of by the
  Authority.

5 Any employee would be caught by the money laundering provisions if either they are
  actively involved in money laundering or suspect money laundering and do nothing
  about it.

6 Whilst the risk to the Authority of contravening the legislation is low, it is extremely
  important that all employees are familiar with their legal responsibilities: serious criminal
  sanctions may be imposed for breaches of the legislation.

The Money Laundering Reporting Officer (MLRO)

7 The officer nominated to receive disclosures about money laundering activity within the
  Authority is the Council‟s Monitoring Officer, contact number: 01228 607350.

8 If an employee is concerned about possible money laundering or the impact of these
  legal requirements on their duties, when considering whether a disclosure needs to be
  made they must seek advice from the MLRO, the Head of Management Audit or their
  line manager.

The Disclosure Procedure

9 Where an employee knows or suspects money laundering activity is taking/has taken
  place, or they become concerned that their involvement in a matter may amount to a
  prohibited act under the legislation, before taking any money they must telephone the
  MLRO for guidance as soon as possible regardless of the amount being offered.
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10 If an employee has no reason to suspect or know that money laundering activity is
   taking/has taken place and if the money offered is less than £2000 in cash as payment
   or part payment for goods/services offered by the Authority then there is no need to
   seek guidance from the MLRO.

11 However, if the money offered is £2000 or more in cash then payment must not be
   accepted until guidance has been received from the MLRO even if this means the
   person has to be asked to wait. The employee can give the reason for this delay to the
   person concerned, as they and the Authority have a responsibility to ensure there is no
   breach of law.

12 Before telephoning the MLRO privately for guidance, where-ever possible employees
   should take the name and address of the person offering the cash payment. If the
   money is subsequently taken a receipt must be issued bearing the name and address of
   the person paying.

13 Once the employee has reported their concern to the MLRO they must follow the
   directions provided. They must not make any further enquiries into the matter
   themselves: any necessary investigation will be initiated by the MLRO. The MLRO will
   in turn refer the matter on to the National Criminal Investigation Service (NCIS) if
   appropriate. All members of staff will be required to co-operate with the MLRO and the
   relevant authorities during any subsequent money laundering investigation.

14 Once the MLRO has evaluated the employee‟s report and any other relevant
   information, they must make a timely determination as to whether:

          there is actual or suspected money laundering taking place; or
          there are reasonable grounds to know or suspect that this is the case; and
          whether the MLRO needs to seek consent from the NCIS for a particular
           transaction to proceed.

15 Where the MLRO does so conclude, then they must disclose the matter as soon as
   practicable to the NCIS on their standard report form and in the prescribed manner,
   unless the MLRO has a reasonable excuse for non-disclosure to the NCIS.

16 Where the MLRO suspects money laundering but has reasonable cause for non-
   disclosure, then they must record this (the MLRO must liaise with the legal adviser to
   decide whether there is a reasonable excuse for not reporting the matter to the NCIS).
   The MLRO can then immediately give their consent for any ongoing or imminent
   transactions to proceed. Where the MLRO concludes that there are no reasonable
   grounds to suspect money laundering then they must record this and give their consent
   for any ongoing or imminent transaction(s) to proceed.

17 Where consent is required from the NCIS for a transaction to proceed, then the
   transaction(s) in question must not be undertaken or completed until the NCIS has
   specifically given consent, or there is deemed consent through the expiration of the
   relevant time limits without objection from the NCIS.

18 All records of the whole process and reports made to the NCIS must be retained by the
   MLRO in a confidential file kept for that purpose, for a minimum of five years.
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19 The MLRO commits a criminal offence if they know or suspect, or has reasonable
   grounds to do so, through a disclosure being made to them, that another person is
   engaged in money laundering and they do not disclose this as soon as practicable to
   the NCIS.

Client Identification Procedure

20 When telephoning the MLRO the employee should have the relevant details which
   should include:
       the name and address of the person offering the payment
       the amount of cash being offered
       any reasons offered about the holding or possession of such amounts of cash
       the reasons for the employee‟s knowledge or suspicion of money laundering
         activity.

21 Additionally the employee should ask if the person offering payment has some
   appropriate form of identification that would satisfactorily prove identity and address. In
   some cases the reasons for having the large amount of cash together with the process
   of identification will be acceptable, but this is to be decided by the MLRO.

Record Keeping Procedures

22 Appropriate records of the whole process must be taken including:
      the name of the person offering the cash
      the amount of cash offered
      the telephone conversation with the MLRO (or other officer)
      copies of the identification documentation provided (or full written details
         including all document serial numbers)

23 Copies of these records must be sent to the MLRO, marked „in confidence‟. The MLRO
   is responsible for keeping such records and reviewing them for any discernible trends or
   problems.

24 At no time and under no circumstances should anyone voice any suspicions to the
   person(s) suspected of money laundering as this may constitute a criminal offence of
   “tipping off”. Do not, therefore, make any reference on a client file to a report having
   been made to the MLRO. Should the client exercise their right to see the file, then such
   a note will obviously tip them off to the report having been made and may render you
   liable to prosecution. The MLRO will keep the appropriate records in a confidential
   manner.

Examples

25 Any transaction involving an unusually large amount of cash should cause questions to
   be asked about the source. This will particularly be the case where cash paid exceeds
   the amount necessary to settle a transaction, and the person(s) concerned request a
   non-cash return of the excess. This will include double payments.

   The reason for the use of trusts or offshore funds for handling the proceeds or
   settlement of a transaction should be questioned.
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Care should be exercised and further enquiries may be needed where:
    a third party intermediary becomes involved in a transaction

     the identity of a party is difficult to establish or is undisclosed

     a vehicle company is used by a third party and the ultimate ownership is
      concealed or difficult to establish

     a party is evasive as to the source or destiny of funds.