Businesses that are covered by the Money Laundering Regulations have to use a risk-based approach to prevent money laundering.
Since July 2017, under the 4th EU Money Laundering Directive (4MLD), all businesses must asses the risk that they could be used for money laundering through an online risk assessment form. We carry out these AML risk assessments for all our clients so they don’t have to. All we ask is that you are open and candid with us to help create an accurate reflection of your level of risk.
When we fill in this form we can decide which areas of your business are at risk and put in place measures to prevent money laundering occurring by using what’s known as a ‘risk-based’ approach.
This guide gives an overview of the risk-based approach that we use. It also outlines your day-to-day responsibilities under the Money Laundering Regulations.
The risk-based approach
Businesses that are covered by the Money Laundering Regulations have to use a risk-based approach to prevent money laundering. This involves following a number of steps.
We have to:
Advantages of the risk-based approach
You’re able to decide on the most cost-effective way to control the risks of money laundering when you follow the steps involved in the risk-based approach. This allows you to focus your efforts and resources where the risks are highest.
When you assess the risks of money laundering that apply to your business you need to consider:
Customers that might pose a risk
Your business might be at risk of money laundering from:
Customer behaviours that might suggest a risk
Behaviour that may indicate a potential risk could be when a customer:
You must send a Suspicious Activity Report (SAR) to the National Crime Agency if you have any suspicion that a transaction relates to money laundering and/or terrorist financing and get a defence to protect you from a money laundering offence. You should always report before a transaction is made where possible. If your suspicion is raised after the transaction is completed you must send a SAR at the earliest opportunity.
Risks associated with your products and services
Depending on your business type there may be a risk:
The types of risk you need to identify will depend on the nature of your business. For example, ‘High Value Dealers’ need to be aware of the risk associated with cash sales of high value goods for more than 10,000 Euros that can be either:
Once we’ve completed your risk assessment you need to:
And that’s it! We will carry out these risk assessments annually so you don’t have to. Get in touch today to find out how we can help you stay compliant without the hassle of having to do it yourself - call on 01932 22 55 33 or email us at firstname.lastname@example.org