Anti-money laundering reforms: another compliance headache for business

Anthony Davies, The Independent, 30 August 2006

 

The author argues that the compliance burden for businesses looks set to increase if the Government enacts proposals contained in a Ministry of Justice discussion document on Anti-Money Laundering and Countering the Financing of Terrorism.

The discussion document, which is a response to an adverse report from a 2003 IMF Financial Action Taskforce, suggests major amendments to the Financial Transactions Reporting Act 1996. While the need for reform is widely acknowledged, the Institute of Financial Advisors has mixed feelings about the proposed changes and has the following comments about some of the practical aspects of the recommendations:

• the costs and responsibility for record keeping by the advisors are onerous;
  
  
• it wants a model providing improved guidance and increased certainty as to what advisors must do;
  
  
• it wants a two year implementation period;
  
  
• there needs to be a balance between costs and obligations; and
  
  
• it cites the requirement to keep records until 5 years after the cessation of a business relationship as"crazy".

It is expected that a legislative reform package will be introduced in 2007.

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