And so we wait. I may have mentioned, oh, a few hundred times that back in March I attended a conference in Brussels (at the EC! Yes, the EC!) on money laundering – and specifically on the revised FATF Recommendations and the proposed Fourth EU Money Laundering Directive. At the time (did I mention that it was in March, at the EC, in Brussels? And that I was there?), they were hopeful that the directive (MLD4) would be adopted before the summer. Now, normally you have to explain that particular term to the English (summer = June, July and August) but this year we got the idea all by ourselves because it has been hot and sunny – and yet no sign of MLD4. Ah well.
The delay has however given me plenty of time to read all about MLD4, and what it changes – and what it doesn’t. And I am still mystified about the exclusion of services from the definition of high value dealers. Let me elaborate. An HVD is someone who trades in goods for cash totalling (at the moment) €15,000 or more – so we’re talking about art auction houses, or high-end jewellers, or car dealers. But why, I wonder, not someone who trades in services for large amounts of cash – such as consultants, or builders, or universities, or brothels? (I threw in that last one to see if you were paying attention. Frankly, anyone who can charge more than €15,000 for that particular activity, well, a bit of AML paperwork shouldn’t be beyond them – although I do appreciate that their handwriting might be rather wobbly.)
Here’s one boringly simple way to launder money if you’re, say, a wealthy and corrupt Chinese PEP: send your kid to university in England, and tell him to pay his fees in cash to the bursar (because that’s how it’s done in China, you tell the naïve bursar) – but he pays ten times too much. Oh dear, your child says – my parents have made a boo-boo with the exchange rate, but I can’t keep hold of all the leftover money, so please could you look after the money for me and make a bank transfer back to them? Why of course we can, says bursar – et voilà! Lovely laundering for a bargain 10%. My position is that anyone who accepts large amounts of cash should be in the AML family, and I’m not quite sure why this is never suggested.