Chapter 10 part 6

Question 1

In general terms there are three strands to the legal rules that apply to money laundering.
These strands are?

Answer 1

• Specific laws that define what represents a criminal offence and the penalties that apply to such acts (which are of general application).

• Money laundering regulations that apply to a stated range of firms carrying on activities in the financial sector (but not specifically to general insurance or general insurance mediation).

• Regulatory rules and guidance apply in different ways to different categories of firms.

Question 2

Criminal Justice Act 1993 made what a criminal offence?

Answer 2

to launder gains from other crimes
Or not reporting any knowledge or suspicion of money laundering.
Or ‘tipping off’ a suspected person a criminal offence.

Question 3

What is the max sentence you can get from assistance to a criminal where you either know or suspect, or ought to have known or
suspected, that money laundering was taking place?

Answer 3

(maximum 14 years’ imprisonment

Question 4

What is the max sentence you can get from failing to report either actual knowledge or suspicion of money laundering ?

Answer 4

maximum five years imprisonment

Question 5

What is the max sentence you can get from “tipping off”?

Deliberately telling someone that you suspect them of being involved in money laundering or that there is a formal or police
investigation under way.

Answer 5

maximum five years’ imprisonment

Question 6

What does POCA stand for?

Answer 6

Proceeds of Crime Act 2002

Question 7

What does ARA stand for?

Answer 7

Assets Recovery Agency

Question 8

POCA set up as what agency?

Answer 8

an Assets Recovery Agency (ARA)

Question 9

What is the purpose of POCA?

Answer 9

to recover the proceeds of criminal activit

Question 10

Offences under POCA are doing what?

Answer 10

• Concealing, disguising, converting or transferring criminal property or removing it from the UK.

• Acquiring, possessing or using criminal property.

• Failing to disclose that someone else is engaged in money laundering.

Question 11

The Serious Crime Act 2007 extended a range of serious crime prevention orders that could be made by the High Court and amended POCA in a number of important respects. It abolished the ARA and transferred all its activities to who?

Answer 11

the Serious Organised Crimes Agency
(SOCA)

Question 12

What does SOCA stand for?

Answer 12

the Serious Organised Crimes Agency
(SOCA)

Question 13

SOCA’s operations merged into a larger National Crime Agency (NCA) created through what act?

Answer 13

e Crime and Courts Act 2013

Question 14

The Serious Crime Act 2015 ensure the National Crime Agency, the police and other law enforcement agencies have the powers yo do what?

Answer 14

effectively and relentlessly pursue, disrupt and bring to justice serious and organised criminals

Question 15

What does MLR 1993 stand for?

Answer 15

Money Laundering Regulations 1993

Question 16

Who does the MLR 1993 apply to?

Answer 16

Defined organisations operating in the UK financial sector, but not general insurance activities, including mediation activities.

Question 17

What does the MLR 2017 cover that the MLR 1993 didnt?

Answer 17

a wider range of businesses

Question 18

What range of buisness’ does the MLR 2017 cover?

Answer 18

• credit and financial institutions (including life insurance companies and financial advisers); and

• auditors, accountants, tax advisers and insolvency practitioners, independent legal professionals, trust or company service providers, estate agents, high value dealers (dealing with goods with a transaction value greater than €15,000).

Question 19

What areas does the MLR 2017 cover?

Answer 19

• Customer due diligence - age ID, intended purpose checks ect
• Policies and procedures. - record keeping, internal controls ect
• Registration - must register with FCA and have procedures for refusals
• Enforcement. - right to enter and inspect premises and use appropriate civil penalty’s.

Question 20

‘Financial crime’ is defined in the Act as what?

Answer 20

fraud, dishonesty, misconduct in, or misuse of information relating to, a financial market or handling the proceeds of crime.

Question 21

how often must you report on systems and controls and effectiveness?

Answer 21

Annually at a minimum

Question 22

What does MLRO stand for?

Answer 22

Money laundering reporting officer

Question 23

Who is the MLRO?

Answer 23

A director or senior manager who takes overall responsibility for establishing and maintaining effective anti-money laundering systems and controls within the firm

Question 24

The MLRO must tick what criteria?

Answer 24

• expected to be based in the UK;

• required to have a certain level of authority and independence within the firm; and

• required to have sufficient resources and information to enable them to fulfil their responsibilities.

Question 25

Anyone who suspects that money laundering is taking place must report this to who?

Answer 25

the MLRO. The MLRO must then decide whether the suspicious transaction should be reported to the NCA.

Question 26

Any verification difficulties should usually be reported to the MLRO and, possibly, by the MLRO to the authorities.
How long should records be kept?

Answer 26

5 YEARS

Question 27

The Bribery Act 2010 created four new criminal offences. What are they?

Answer 27

1. Giving, promising or offering a bribe
2. Requesting, agreeing to receive or accepting a bribe
3. Bribing a foreign public official
4. Failure by a commercial organization to prevent active bribery being committed on its behalf.

Question 28

What three company’s form the UK’s financial services regulation framework?

Answer 28

FPC, PRA and FCA

Question 29

Under the Bank of England and Financial Services Act 2016, the PRA became part of the Bank of England and what committee was established?

Answer 29

Prudential Regulation Committee (PRC) w