Grossbyte will take measures to prevent the Customers being exposed to money laundering, to identify areas in which money laundering may occur and to comply with legal and regulatory requirements, especially the process for reporting actual or suspected money laundering cases to the Councils Money Laundering Reporting Officer (Monitoring Officer). It is the responsibility of every officer to be vigilant and act promptly in all suspected cases.
The Proceeds of Crime Act 2002, the Terrorism Act 2000 and the Money Laundering Regulations 2007 place obligations on the council and its employees with respect to suspected money laundering, the key points being
- The reporting and detection of suspected money laundering.
- Officers must be vigilant for the signs of money laundering.
- Any employee who suspects money laundering activity must report this promptly to the council’s Money Laundering Reporting Officer (see reporting form for completion by the officer suspicious of activity).
- No payment to the council will be accepted in cash if it exceeds £2000.
- Where the council is carrying out certain regulated activities during day to day business then the customer due diligence procedure must be followed, for example some Treasury Management activities are regulated by the Financial Services Authority.
- The Money Laundering Regulations are complex and detailed and should there be any doubt about the policy requirements, please request further information from line management.
The policy applies to all officers and members, and sets out procedures for the reporting of suspected money laundering activities with the aim to reduce potential criminal activity. The policy defines procedures that will assist the council to comply with its legal obligations.
The Policy should be read along side the councils Whistleblowing Policy, Anti-Fraud and Corruption Policy and the Treasury Management Practice – money laundering guidelines.
Failure of an officer to comply with the procedures defined within this policy may lead to disciplinary action in line with the council’s Disciplinary Policy Procedures.
Failure of a member to comply with the procedures defined within this policy would be reported to the leader for further action, for example a possible report to the Standards Committee.
What is Money Laundering?
Money laundering is a term used which relates to offences involving the proceeds of crime or terrorism funds. The following acts are defined as acts of money laundering
- Concealing, disguising, converting, transferring criminal property or removing from the UK (section 327 of the Proceeds of Crime Act (POCA) 2002).
- To enter into or become concerned in an arrangement which you know or suspect will assist the acquisition, retention, use or control of criminal property or on behalf of another person(POCA section 328).
- Acquiring, using or possessing criminal property.
These are primary money laundering acts, two secondary offences are also defined which relate to the failure to disclose any of the three primary acts and tipping off (POCA section 330). Tipping off is where someone informs a person or persons involved in, or suspected to be involved in money laundering acts, in such a way as to reduce the likelihood of their being investigated.
While the risk to the council of breaching legislation is considered to be low, officers in all areas should be aware that they could be potentially exposed to money laundering acts. It is important that all employees’ are aware of their responsibility to report any suspicions of money laundering activity as detailed within this policy (see reporting). All officers are responsible to act promptly and report any suspicions to the Money Laundering Reporting Officer to prevent any breach of legislation which can lead to serious criminal penalties.
The Money Laundering Reporting Officer (Monitoring Officer)
The officer nominated to receive disclosures about money laundering activity is the Monitoring Officer. The Money Laundering Reporting Officer will deal will all disclosures confidentially and make decisions on reporting the activity to the Serious and Organised Crime Agency (SOCA) in the appropriate manner, all reports will be retained for five years. Contact details
Any employee who suspects money laundering activity should report their suspicions promptly to the Money Laundering Reporting Officer using the form attached (see reporting form for completion by the Money Laundering Reporting Officer, referenced AML Form 1), upon receipt of the report the Money Laundering Reporting Officer may contact you directly to discuss the content of the report as required.
No further enquiries should be made about the suspected money laundering after reporting to the Money Laundering Reporting Officer for action. No further steps in any transaction relating to the suspected money laundering should be made without authorisation from the Money Laundering Reporting Officer. For example, if repeated reported cash overpayments are received to a specific account seek guidance from the Money Laundering Reporting Officer before the amounts are refunded as an Allerdale Borough Council cheque.
No disclosure should be made to others that would indicate suspicions of money laundering. Any officer reporting should not discuss the matter with others or note on file that a report has been made to the Money Laundering Reporting Officer as this may result in the suspect becoming aware of the situation.
The Money Laundering Reporting Officer will promptly evaluate any Disclosure Report to determine whether it should be reported to SOCA.
The Money Laundering Reporting Officer will, if necessary, promptly report the matter to SOCA on the standard electronic report form in the prescribed manner via www.soca.gov.uk.
Failure to report a disclosure to SOCA is considered a criminal offence without reasonable grounds. All disclosures will be retained on file for five years.
Customer Due Diligence
Extra care needs to be taken when the council is carrying out regulated activities, this is known as customer due diligence, for example treasury management activities, charging for a service as a business or a customer other than a UK public authority. Due to the nature and stringent guidelines for regulated business, you will be aware if your duties involve regulated activities.
If customer due diligence (CDD) applies, you must seek evidence of identity, for example :
- Check the business’s website to confirm their business address.
- Conduct an on-line search via companies house to confirm the nature of business and identity of any directors.
- Seek evidence from the key contact of their personal identity following the guidelines for identifying customers (see the council’s cashiering procedure notes section seven for guidance).
Identification must be retained for five years after the end of the business relationship.
Guidance and Training
The council will make all officers aware of the requirements and obligations placed on the council and on themselves as individuals by anti-money laundering legislation and give targeted training to those most likely to encounter money laundering. See Appendix A at the end of this document.
Further information can be obtained from the following sources:
“Proceeds of Crime (Anti-Money Laundering) – Practical Guidance for Public Service Organisations” – CIPFA