The Sixth Money Laundering Directive is already on its way
The Fourth Directive and Fifth Directive are soon to be joined by new EU wide anti-money rules. Despite a fair number of countries still struggling to pass the Fourth Money Laundering Directive; and with the EU only recently agreeing to the Fifth Money Laundering Directive, the EU Commission is going ahead with a Sixth Money Laundering Directive.
Where the Fourth Directive focused on risk and the Fifth Directive focuses transparency, the upcoming Sixth Directive will focus on criminal offences and penalties.
Key changes expected in the Sixth Directive include:
- Defining all 22 predicate money laundering offences and harmonising the criminal nature of money laundering across the EU
- Staff anti-money laundering training on recognising all predicate offences
- Aiding and attempting to commit money laundering will be an offence
- Providing a comprehensive definition of money laundering
- Imposing a minimum five year prison sentence for serious offences
- Extending criminal liability to legal persons
- Aggravating circumstances can be applied for convictions relating to serious offences such as corruption and human trafficking
- Bosses may be personally liable for corporate crimes under new ‘Failure to supervise’ offences
- Penalties for money laundering offences could include prohibition from public welfare benefits, bans from conducting business or forced wind-up of businesses through which the offences were committed
The Sixth Directive – increasing accountability for companies
Overall, the Sixth Directive will do even more to put professional money launderers out of business. The judicial closing of companies involved in laundering and significant bans on individuals involved will aid the crackdown. The new offences of failing to supervise and potential prosecution of individuals who allow criminal liability to amass in a company will enable better targeting of larger companies who fail to crack down on money laundering.
The passage of the Fourth, Fifth and Sixth money laundering directives in quick succession should make all businesses sit up and take notice, particularly if they are dealing with high-risk industries or those who are high risk themselves. Comprehensive training, risk assessments and internal procedures will be crucial. Companies who are still lagging behind in getting themselves in line with the Fourth Directive will have to work quickly because there isn’t much more time to spare.
Anti-money laundering resources
VinciWorks continuously publishes anti-money laundering compliance resources. The resources include policy templates, guides, anti-money laundering training demos and more.