Financial and Corporate Crime

This practice note sets out details of activities that can be passported under the recast Banking Consolidation Directive (2006/48/EC) (BCD) and guidance from UK regulatory authorities on the corresponding regulated activities in the UK.

This note outlines the UK Bribery Act 2010 and the US Foreign Corrupt Practices Act 1977 (FCPA) and the anti-corruption regimes in which they operate. It focuses particularly on the practical implications of the differences between these two important pieces of legislation.

This Practice note provides an overview of the money laundering regime that applies to lawyers pursuant to the Money Laundering Regulations 2007 (2007 Regulations). The 2007 Regulations came into force on 15 December 2007 and replace the Money Laundering Regulations 2003 (2003 Regulations). They bring the 2005 Directive on money laundering into effect in the UK. The 2007 Regulations introduce new requirements and vary requirements that were in the 2003 Regulations. In particular, the 2007 Regulations require that: The lawyer is able to identify the beneficial owner of client trusts, companies and partnerships. The lawyer applies customer due diligence measures and monitors client activities according to a risk-based approach, applying less stringent procedures for low risk situations and more stringent procedures in higher risk situations. Training for staff is both regular and covers terrorist financing issues. Lawyers are also to have regard to the Law Society's anti-money laundering practice note published on 6 October 2011, and the Solicitors Regulation Authority's warning cards on money laundering (April 2009), property fraud (April 2009) and bogus law firms and identity theft (March 2012).   Property lawyers should also take account of the joint Land Registry and Law Society practice note on property and registration fraud (September 2010), and the Law Society's note on mortgage fraud (October 2011).

An overview of the FSA's thematic work to reducing the risk of money laundering in the financial services sector, before the FCA took over its financial crime responsibilities on 1 April 2013.

Every two months, Berwin Leighton Paisner LLP's Financial Crime Team, led by partners Daren Allen and Aaron Stephens, share their views on topical financial crime issues with PLC Financial Services subscribers. The team's comments can be accessed below.

This note addresses the issues to consider in creating an anti-corruption policy with particular emphasis on the Bribery Act 2010, the new offence of failing to prevent bribery under section 7 of that Act and the adequate procedures defence to that offence.

In this practice note, Aaron Stephens and Daren Allen, partners in Berwin Leighton Paisner LLP's Financial Services Investigations and Enforcement practice, consider the implications of the Bribery Act 2010 for banks and other financial institutions (including insurance firms, asset management firms, hedge funds and private equity houses), and the practical steps firms should take to comply with the new regime. The Act came into force on 1 July 2011. For a general overview of the Act, see Practice note, Bribery Act 2010, and for information on the background to the Act, see Practice note, Bribery: law reform.

This note looks at how promotional expenses, such as corporate hospitality and gifts, may be dealt with under the Bribery Act 2010.

This note looks at facilitation payments, examining in particular what they are, why the lack of an exemption in the Bribery Act has been controversial, how the SFO plans to enforce the Bribery Act in relation to them and what can be done to prevent them being made. Information is also given on the position the OECD and other countries have taken towards facilitation payments.

This note explains the purpose of a statement of ethics (or anti-corruption statement) and how it might best be used in the context of the Bribery Act 2010, particularly in relation to implementing adequate procedures to prevent bribery and demonstrating a top level commitment to doing so. This note accompanies Standard document, Bribery Act 2010: sample statement of ethics.

In this note, Christine O'Neill, partner, and Paul Marshall, associate, of Brodies LLP consider the bribery and corruption self-reporting initiative in Scotland. This initiative was introduced on 1 July 2011, when the Bribery Act 2010 came into force, and is run by the Serious and Organised Crime Division (SOCD) of the Crown Office and Procurator Fiscal Service (COPFS).

An examination of the impact of insolvency on commercial fraud claims, this practice note considers the pari passu principle, transactions defrauding creditors, adjustments of prior transactions, fraudulent trading, wrongful trading and some potentially useful provisions for obtaining information from individuals and companies.

This note provides a summary of the Corporate Manslaughter and Corporate Homicide Act 2007. The Act received Royal Assent on 26 July 2007 and is in force from 6 April 2008 (with the exception of the provisions relating to deaths in custody). The Act applies to the whole of the UK. Broadly, under the Act, an organisation (which includes most employers) is guilty of an offence if the way in which its activities are managed or organised (by its senior management) causes a person's death and this amounts to a gross breach of a relevant duty of care owed by the organisation to the deceased.

A tracker outlining the progress of the Crime and Courts Bill 2012-13 (now the Crime and Courts Act 2013).

This practice note considers the mandatory and discretionary exclusion of contractors from competing for public contracts if they have been convicted of bribery or corruption.  The note focuses on: Regulation 23 of the Public Contracts Regulations 2006 (SI 2006/5). The coming into force of the Bribery Act 2010. The potential impact of a conviction under section 7 of the Bribery Act 2010.

This is a quick guide to the EU financial services supervisory framework that formally came into effect on 1 January 2011. The framework is known as the European System of Financial Supervision (ESFS). It consists of: The European Systemic Risk Board (ESRB). The European Supervisory Authorities (ESAs) (which have replaced the previous level 3 "Lamfalussy" committees): the European Banking Authority (EBA); the European Securities and Markets Authority (ESMA); and the European Insurance and Occupational Pensions Authority (EIOPA). The Joint Committee of the ESAs. The 27 EU member state national supervisors. For a more detailed overview of the ESFS, see Practice note, An overview of the EU Financial Services supervisory framework. The reform of the EU financial services supervisory framework, which resulted in the ESFS, was tracked in Reform of European financial services supervisory framework: key developments tracker. This tracker includes key source materials, together with related PLC Financial Services coverage.

In this practice note, Jane Tuckley, partner, and Nigel Barratt, Director of Research, from Travers Smith LLP's Financial Services and Markets department, provide an overview of the FCA's criminal prosecution powers. This practice note is part of a series of Travers Smith LLP practice notes on the FCA's disciplinary and enforcement powers. For more information, see Practice note, FCA disciplinary and enforcement powers: a guide to content written by Travers Smith LLP.

Consideration of the FCA's financial crime requirements in its Handbook, which include a number of specific anti-money laundering (AML) requirements.

In this practice note Aaron Stephens, a partner, and Elinor Lloyd and Chris Webber, senior associates, in Berwin Leighton Paisner LLP's Financial Services Investigations and Enforcement practice, consider the legal and regulatory framework relating to instances of fraud involving financial institutions. Among other things, the note: Outlines the principal statutory and common law offences that are relevant to instances of fraud. Considers the FSA's regulatory requirements and role. Examines the roles that other agencies, such as the Serious Fraud Office (SFO), play in investigating and prosecuting fraud.  Gives practical guidance to help firms manage the legal and regulatory risks posed to them by fraud. This note is in the process of being updated by its authors to reflect the new UK regulatory structure that came into effect on 1 April 2013.

This practice note contains a decision tree produced by Aaron Stephens, a partner, and Helen Armstrong, an associate, both in Berwin Leighton Paisner LLP's Financial Services Investigations and Enforcement practice, which is designed to help FSA-authorised firms determine whether they are faced with a potentially notifiable matter under Principle 11 of the FSA's Principles for Businesses (PRIN) or Chapter 15 of the FSA's Supervision manual (SUP). This note is in the process of being updated by its authors to reflect the new UK regulatory structure that came into effect on 1 April 2013.

This note provides an overview of HM Treasury's post-implementation review of the Money Laundering Regulations 2007 (SI 2007/2157) (MLRs). The MLRs, which are designed to address threats from money laundering and terrorist finance, came into force on 15 December 2007, implementing the Third Money Laundering Directive (2005/60/EC) (known variously as MLD3, 3MLD, 3AMLD and Third AMLD). At that time, HM Treasury committed to carry out a post-implementation review of the regime under the MLRs after two years of operation.

This note outlines key international initiatives that affect the UK anti-money laundering (AML) and counter-terrorist financing (CTF) regime, including the Financial Action Task Force's (FATF) standards, the Wolfsberg Group's guidance and the US Patriot Act 2001.

An overview of the requirements of the Money Laundering Regulations 2007 (SI 2007/2157) (MLRs), which came into force on 15 December 2007, implementing the Third Money Laundering Directive (2005/60/EC) (known variously as MLD3, 3MLD, 3AMLD and Third AMLD). Although the MLRs apply to a wide range of businesses, this note focuses on the implications for firms authorised under the Financial Services and Markets Act 2000 (FSMA).

An overview of the OFT's anti-money laundering (AML) regime under the Money Laundering Regulations 2007 (SI 2007/2157) (MLRs). The regime applies to consumer credit lenders carrying on business in the UK who are not authorised under the Financial Services and Markets Act 2000 (FSMA) or supervised by HMRC as a money service business (MSB). Consumer credit lenders that fall within the OFT's regime are known as "consumer credit financial institutions" or "CCFIs". CCFIs have had to comply with AML legislation since 1994. However, until the MLRs came into force on 15 December 2007 CCFIs did not have a statutory supervisor.  The OFT's regime under the MLRs also applies to estate agents, however, they are outside the scope of this note. Please note that we are in the process of updating this note to reflect the updated anti-money laundering enforcement principles published by the OFT on 15 May 2013 (see Legal update, OFT updates anti-money laundering enforcement principles).

An overview on how to comply with the reporting obligations under the Proceeds of Crime Act 2002 (POCA) and the Terrorism  Act 2000 (TACT) relating to suspected money laundering or terrorist financing. It covers: How to identify suspicious activities. The practical steps to be taken when a suspicious activity has been identified. The content of internal and external reports. For more information on the reporting obligations under POCA and TACT, see Practice note, UK money laundering and terrorist financing offences in POCA and TACT .

An overview of the provisions of the Third Money Laundering Directive (2005/60/EC) (known as MLD3,  3MLD, 3AMLD and Third AMLD) which came into force on 15 December 2005. Member states were required to implement the Directive by 15 December 2007. This was achieved in the UK mainly by way of the Money Laundering Regulations 2007 (SI 2007/2157) (MLRs), which came into force on 15 December 2007.

An overview of the European Commission's review of the Third Money Laundering Directive (2005/60/EC) (known variously as "MLD3", "3MLD", "3AMLD" and "Third AMLD"), which was carried out from 2010 to 2012. Following the review, in April 2012, the Commission published a report outlining the proposed amendments it was considering making to MLD3. For more information, see Practice note, Hot topics: Third Money Laundering Directive: European Commission's proposed reforms.

An overview of the money laundering and terrorist financing offences set out in the Proceeds of Crime Act 2002 (POCA) and the Terrorism Act 2000 (TACT) respectively. POCA and TACT form part of the UK's anti-money laundering (AML) and counter-terrorist financing (CTF) regime.

An overview of EU Regulation 1781/2006 on information on the payer accompanying transfers of funds (known variously as the "Wire Transfer Regulation", the "Payments Regulation" and the "Fund Transfers Regulation"), which came into force on 1 January 2007.  The Wire Transfer Regulation forms part of the EU action plan to combat money laundering and terrorist financing. It requires payment service providers (PSPs) to ensure that electronic fund transfers (also known as wire transfers) are accompanied by complete information on the payer (that is, the customer originating the transfer). This note also outlines the UK regime for monitoring and enforcing PSPs' compliance with the Wire Transfer Regulation, under the Transfer of Funds (Information on the Payer) Regulations 2007 (SI 2007/3298). For a checklist summarising good practices in complying with the Wire Transfer Regulation, see Checklist, Wire Transfer Regulation and for information on the European Commission's review of the Wire Transfer Regulation, see Practice note, Wire Transfer Regulation: European Comission's review.