EU anti-money laundering directive targets virtual currencies and offshore accounts
The new EU anti-money laundering rules coming into force on 26 June 2017 represent a move to a truly European approach to tackling money laundering, terrorist financing, and concealment of funds through offshore structures and virtual currencies. This follows a spate of terrorist attacks last year, and the growing adoption of untraceable digital technologies to finance terrorist activities. Around the same time, the Panama Papers leak shone a light on the concealment of assets by individuals using shell companies in offshore accounts. There is growing concern among European governments that offshore jurisdictions possess characteristics which could enable terrorist financing by permitting terrorism donors and beneficiaries to operate anonymously.
The measures will tackle terrorist finance risks relating to virtual currencies, and anonymous prepaid instruments (e.g., prepaid cards); impose stronger checks on high-risk third countries; ensure full public access to the beneficial ownership registers; and enhance the powers of EU Financial Intelligence Units.
Navigant’s white paper outlines how UK firms can ensure they have strong and robust compliance regimes to address and mitigate the risk of their institutions being used for money laundering or terrorist financing purposes.