The Sixth Money Laundering Directive is already on its way
The Sixth Directive is due to be implemented into national law by 3 December 2020. While the UK anti-money laundering regime already complies with a great deal of it, the Sixth Directive calls for the introduction of a new corporate offence for failing to prevent money laundering, which is not included in the UK regime.
The UK already has a few corporate ‘failure to prevent’ laws on the books in the form of failure to prevent bribery and tax evasion. Whether the UK is required to implement this new failure to prevent money laundering rule will depend on the status of the transition period at the time. The Sixth Directive focuses on harmonising money laundering offences across the EU, such as extending criminal liability to legal persons and aiding and attempting to commit money laundering should be an offence.
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.
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. Further, we will be keeping our anti-money laundering training up-to-date with the latest regulations as they come into force.