Implementation Countdown: How to Successfully Comply with the European Union’s 3rd Money Laundering Directive

The third European Union Money Laundering Directive implementation deadline is looming in December, but EU countries are still struggling with how to translate its mandates into law when the December deadline rolls around. In fact, a report by the City of London warned that haphazard transposition of the third directive could result in a repeat of what happened with the implementation of the second Directive - ill-defined terminology and reporting inconsistencies. Now, the third Directive will bring more changes and challenges for financial institutions’ anti-money laundering programmes. Learn from the experts that helped draft the Directive, and the ones that are implementing it, if you are ready to comply and what to expect from domestic regulations in the months to come.

Using the Internet to Solve Your AML Puzzles

Exploiting the Web to perform your AML duties can be efficient and cost effective. This popular and enriching panel features expert Web investigator, John Pyrik, who will teach you how easy it is to mine the Web’s hidden resources for money laundering investigations and due diligence. Pyrik, has a broad range of analytical and investigative experience accumulated from 16 years as an intelligence officer, a securities investigator, and a money laundering analyst. He is considered a subject matter expert on the Internet by the Royal Canadian Mounted Police (RCMP) and has taught courses since 1999. An experienced and engaging presenter, he will walk you through the valuable nuggets of information and intelligence that the Web provides. You will leave this session with a wealth of sources you can use in your daily AML work in the private or public sector.

Walking the Fine Line Between AML Compliance and Data Protection - Keeping Customers and the Government Content

The disclosure by SWIFT of European and other financial institutions’ customer and funds transfer information to U.S. law enforcement agencies has sparked great controversy in Europe. The EU and Belgium concluded that the U.S. government’s financial and customer data requests violated EU data protection laws. This case showed how institutions face contradictory mandates: they are subject to strict customer privacy and confidentiality obligations in their countries, but they also must comply with AML and counter-terrorist financing laws and regulations. How can institutions create enterprise-wide AML programmes that don’t overstep the boundaries of customer data protection? How should they comply with privacy laws while providing the government with the appropriate information it seeks? What should they bear in mind regarding legal risks when sharing information with affiliates abroad? Here, you get expert answers to these concerns and learn how better to balance these two vital interests.

The Building Blocks of a Successful Risk-Based AML Programme

Risk matrices are no longer enough in the eyes of most AML regulators in the EU and other nations. Now an enterprise-wide, risk–based approach to money laundering controls is expected by local regulators and global standard setters like the Financial Action Task Force. Institutions must develop risk evaluation systems and show that they adequately and consistently assess all relevant risks across the business lines. That is good theory, but how should you put it into practice in your organisation? A recent survey by the FATF found that financial institutions feel the risk-based approach is beneficial but find that they get little guidance in how to implement it. In this vital session you will learn how the experts do it, what tools to use and how institutions should assess their overall risk and succeed in building effective risk-based processes that conform to regulatory expectations.

Unmasking the Beneficial Owners Hiding Behind Corporate and Trust Devices

The Financial Action Task Force and leaders in the anti-money laundering field say the most effective way to thwart and uncover a money laundering scheme that uses corporations and offshore accounts is to identify the beneficiary of the transactions. That truism is not as easy to execute as it sounds. The real challenge lies in identifying the individuals who are hidden behind layers of corporations, shareholders, relatives, lawyers, nominees and other intermediaries. The Federation of European Banks and the European Banking Industry Committee, among other European organizations, have expressed vocal concerns about the requirements of the 3rd EU Directive to identify beneficial owners. Is it possible to peel away the layers of disguise? What are the best practices that an institution can follow? Here you will learn the steps you can take to give you a better chance of unmasking beneficial owners of accounts and transactions.

The Lessons that Terrorist Financing Cases Teach

The major terrorist attacks of the past decade have left few patterns upon which financial institutions, and even governments, may develop best practices, policies and procedures to defend against being used to finance terrorist activities. The biggest challenge in the area of financial crime is identifying the movement of money for the purpose of facilitating and conducting terrorism. Can financial institutions provide meaningful help to government agencies? Do sanctions lists help in the pursuit of terrorists and their detection by financial institutions? Learning how terrorists financed their operations in the cases where they succeeded provides clues on what financial institutions should look for and what patterns are helpful in pinpointing customers who may be financing terrorism. In this session, experts will dissect cases to teach you how terrorist funds flowed and how financial institutions were used and what patterns have emerged.

How the Extraterritorial Reach of U.S. Laws and Regulations May Be Kept at Bay

The United States money laundering laws, regulations and sanctions, have touched many European institutions in the past few years. The USA Patriot Act is noteworthy because the overwhelming majority of its money laundering-related provisions are aimed at non-U.S. financial institutions. This outward look and reach poses serious risks to European institutions: penalties, prosecutions and reputational damage. Even though U.S. laws pose the threat of adverse government action, they are not widely understood by European institutions. The USA Patriot Act also strengthened the asset forfeiture laws by adding crimes committed outside the U.S. as appropriate predicates to prosecution and forfeiture of a non-U.S. bank's U.S. correspondent or interbank account for the funds of its home customers. Here, experts teach the crucial aspects of U.S. legal and regulatory extraterritorial requirements and show you how they apply to you.

WORKSHOPS

First-Rate Techniques for Conducting AML Investigations

If dirty money is being laundered in your institution it is crucial that you detect it before the government examiner or investigator does. To do that you need to understand how to conduct a good internal AML investigation. There are few better ways to learn investigative skills than by hearing how experienced investigators follow the money in real-life money laundering cases. Knowing how the criminal mind works, how criminals move their money and how internal lapses may have betrayed your institution, are invaluable attributes in your internal investigations. You will learn investigative skills to help you identify, trace and block illicit funds from entering and moving through your institution.

Customer Identification: The Name Game

Unless you are sure of who your customers really are, you can not be sure of what lies behind a transaction. Obtaining and verifying information about your customers are the essential first steps in know your customer and anti-money laundering programmes in any country. Walking the precarious line between thorough customer identification and verification procedures and driving away potential customers is a challenge. In this workshop, experts lead you through real-life scenarios to help you ensure that you follow the right, efficient procedures to identify and assess different types of customers.

Tailor-made: Controlling Internal Risks by Customizing Training to Fit Employee Profiles

Your employees are your first line of defence in money laundering controls. From the top executives to the tellers, all employees must receive personalized training according to their risk level. What type of training is appropriate? Is awareness training sufficient for the board of directors? What advanced training should some employees receive? By tailoring your training programmes to their roles and responsibilities, you prepare employees to face their unique AML risks. At the same time you will save money and maximize the effectiveness of your AML programme. In this workshop, experts who follow the "tailored" approach to employee training, offer crucial guidance on how to adapt training programmes to help you reduce the risk that your employees become an AML threat.

To Bank or Not to Bank: The PEP Dilemma

The European Union’s 3rd Money Laundering Directive requires heightened scrutiny of politically exposed persons in other member states or foreign countries. Proceeds of corruption in a financial institution can cause grave regulatory, prosecutorial and reputational consequences. Despite the international focus on PEPs, corruption money finds its way into private banking and other financial accounts of institutions in most countries, particularly those that have tight bank secrecy laws. Lazarenko of the Ukraine, Adamov of Russia, Obiang of Equatorial Guinea, Pinochet of Chile, are examples of how corruption money is often welcomed by financial institutions. This workshop will teach you how to identify PEPs, how to mitigate their risks and how to meet the requirements of the new EU Directive.

Speaking the Same Language: Writing STRs that Translate into Investigative Leads

Millions of suspicious transaction reports (STRs) are filed each year around the world and the numbers will continue to grow as money laundering laws and regulations expand. Examiners assure that they do not evaluate the quantity but rather the quality of STRs. Yet, STR quality continues to be a problem for authorities like the United Kingdom’s Serious Organized Crime Agency, whose head, Sir Stephen Lander, called for a revamping of the SAR system in the U.K. last year. Learn the who, what, when, why of suspicious activity reporting, and what can make a STR into an investigative lead. Experts will teach you how to improve the quality of your suspicious transaction reporting programme to decrease the chances that regulators find them faulty.

Practical Solutions to the Wire Transfer Dilemma

As the volume of cross-border transactions resulting from the growth of international business and trade increases, banks face a new set of AML challenges in handling these transfers. Something your institution must look out for is the risks of cover payments. Cover payments are used in international funds transfers when the originating and receiving banks do not have a relationship to settle transactions directly or they use differing payment message systems. These banks rely on an intermediary bank to clear the transaction, but that bank doesn’t always transmit beneficiary and source information, creating obstacles for the receiving institution to monitor transfers. This problem has gained the attention of the Wolfsberg Group, which called on SWIFT to unify its payment messaging system so that all institutions in the payment chain have access to the same information. Until that happens, what must your institution do to protect itself? Hear expert advice on how to deal with these issues and how to monitor these transfers.

Fortify your AML Foundation by Building an Internal FIU from the Ground Up

The principal function of a government financial intelligence unit is to act as a nationally centralized agency that receives, analyzes and distributes information to financial institutions and domestic and foreign authorities. This exchange of information is critical to assisting money laundering and terrorist financing investigations worldwide. By applying the same principles of a national FIU at your financial institution, you can reap the benefits of having an internal unit dedicated to mining and interpreting the mounds of data that flow through your institution. Here, discover how to build an internal FIU to help you identify suspicious patterns, trends and risks. Learn how to implement the best practices of an FIU to your AML controls.

Capture, Prioritize, Document: The Keys to Transaction Monitoring

Transaction monitoring is an integral part of financial institutions’ anti-money laundering programmes. Not doing it properly could lead your institution to miss suspicious transactions. The Third Directive’s new enhanced due diligence requirements make transaction monitoring even more crucial for institutions in the region. How do you ensure your system is capturing the necessary data to properly monitor customers and transactions? How do you decide the appropriate level of monitoring for a customer’s risk? And how do you prioritize the alerts your system generates to decide whether to follow up with investigations? During this session, experts will give you the keys you need to perform thorough transaction monitoring. You will gather best practices on effectively implementing and managing a robust transaction monitoring system.

Managing the AML Risks of Corporate Customers

The Financial Action Task Force warned against the money laundering threats of corporate vehicles in 2006. It is now evident that corporations often facilitate money laundering and hide the beneficiaries of dirty money. However, many AML officers struggle with navigating the maze of corporate structures and uncovering who is behind them. In some countries, like the United Kingdom, businesses such as limited liability companies can be formed without providing beneficial ownership information. How do you protect your institution from the risks associated with corporations? Here, learn to manage these customers to lessen the dangers associated with them.

Preventive Care: Immunize Your Institution from New Laundering Schemes

As the landscape of money laundering grows increasingly complex, criminal masterminds are plotting ever devious ways to launder money using non-conventional methods. When you implement AML controls, you should also analise how a criminal would get around them. Getting ahead of them is the key. In fact, a recent survey of AML professionals around the world rated keeping track of new money laundering methods as one of the top AML compliance tasks. Knowing how criminals are moving their funds helps you outsmart them and inoculate your institution against criminal schemes before they occur. In this panel learn how to take a closer look at your controls and how newly developed schemes and scams can outdate them.

ROUNDTABLES

Russia: Acceptable Risk or Compliance Headache?

The steady growth and increasing stability in the Russian economy have attracted many foreign banks to enter the Russian market. But whether they’re setting up shop in the country or acquiring a local bank, there are many AML considerations for foreign banks looking to do business in the region. Although some fear the political risks of the past, the main challenges banks face relate to more practical matters, including AML compliance. What should your institution consider before deciding to do business in Russia? What AML rules must your institution comply with? How do you choose your customers and third-party vendors to minimize your risks? How do you effectively meet know your customer and due diligence requirements? Learn from your peers in this expert-led discussion about the growing pains of doing business in Russia.

Striving for AML Perfection through Effective Quality Assurance

Quality assurance of AML programmes and due diligence procedures is now a standard process in many financial industries that are subject to AML legal requirements. Many institutions have made quality assurance of the AML policies and procedures an integral part of AML compliance. Some institutions have instituted quality assurance or compliance testing teams to probe the efficiency, effectiveness and economy of their AML programme. These teams test areas of the AML programmes to assure the highest level of compliance and to identify areas where policies and procedures may not be working or need strengthening. Quality assurance is a great tool to examine the health of an AML programme. You will come away from this roundtable with an understanding of the sound practices you should adopt.

Handle with Care: Monitoring Offshore Accounts

Offshore accounts hold inherent risks that can never be ignored by a financial institution that wishes to avoid trouble in the money laundering field. They are an attractive vehicle for drug traffickers, tax evaders, politically exposed persons and international criminals of all types to hide their illicit funds. To prevent misuse and abuse, institutions must approach them with a blend of accurate risk scoring, close monitoring and a suspicious eye. How do you accurately rate the AML risk of an offshore account? What type of monitoring should you conduct? Here you will receive advice from AML specialists on how to open and supervise offshore accounts while keeping criminal proceeds at bay and protecting your institution.

Complying with the New Payment Services Directive: What's the Bottom Line?

The European Union payment services directive, adopted by the European Parliament in April 2007, set a number of new requirements for money services businesses and other businesses engaged in payment services. To operate, these businesses will have to obtain a license directly from the European Union, but to do so they must show proof – including a business plan, details of the businesses’ internal controls and AML procedures and evidence that its directors are of ‘good repute’ – that they have effective money laundering controls. Money services businesses and other firms in the EU have expressed concern that this new burden will further strain their overtaxed budget for regulatory compliance. In this session you will learn what you must know about the new directive, if it applies to you and how to prepare for compliance with its requirements.

How much is too much? Responding to Information Requests from Government Agencies

Financial institutions around the world must respond to requests for information from local and foreign financial intelligence units and authorities. These may include request for documentation supporting suspicious transaction reports, inquiries by local or foreign FIUs, court orders and more. Not complying with these requests could result in regulatory criticism and even sanctions, so institutions must ensure that the requests are legally sound. Do you know how much information you can provide without risking giving too much? Which requests are acceptable and which should raise red flags? Here you will learn best practices how to ensure you adequately respond to information requests and how to document the steps you took in complying to minimize risks.

Reducing False Positives and Catching the Dangerous Ones: Managing Sanctions and Watch Lists

Screening names against watch lists issued and updated by government agencies and international bodies like the United Nations is an important part of customer acceptance procedures and ongoing customer and enhanced due diligence. While financial institutions may rely on automatic transaction filtering systems, expert AML specialists know that the systems are only as good as the people who use and run them. Improper administration and maintenance of the systems can lead to dangerous lapses in your AML and counter-terrorist financing controls; the least of your problems may be numerous false positives or missed matches. In this session, you will gather best practices from seasoned experts and you will exchange ideas with peers on effectively managing and screening customers against government watch lists.

The PEP Next Door: AML Policies for Domestic Political Figures

The 3rd Money Laundering Directive of the European Union requires enhanced due diligence on customers who are considered PEPs, defined as foreign senior political officials, their family members and close business associates. EU Member state political figures are considered PEPs in the directive’s definition, but some argue that the EU should be considered one unified jurisdiction for the PEP definition. Would this put financial institutions at higher risk? What are the best policies to apply to these customers? How should your AML processes for EU and non-EU PEPs differ? At this roundtable, you will have the opportunity to learn from experts and discuss with your colleagues how you should treat PEPs in your nation and elsewhere and what new procedures you should now apply at your institution.

International asset recovery efforts: how they affect the compliance officer’s job

Corruption perpetuates many forms of transnational crime including money laundering. For years, it has been clear that without the help of corrupt public officials and the willing or unwitting assistance of institutions that handle their dirty money, the laundering of the proceeds of most international crimes would not be as prevalent. The 2005 United Nations Convention Against Corruption aims to combat this, but what many may not know is that it also brings new requirements that compliance officers must be aware of. Part of the UN’s effort is recovering corruption proceeds, which often sit hidden in accounts at some of the world’s largest banks, and the compliance officers are the ones who will be receiving inquiries to aid in these efforts. In this discussion, learn from an asset recovery expert the latest developments in your country, familiarize yourself with the provisions that apply to your institution and be prepared to respond to requests you may receive as part of this global effort.