Now that’s what I call a service charge

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.

This entry was posted in AML, Legislation, Money laundering and tagged , , , , , , , , . Bookmark the permalink.

3 Responses to Now that’s what I call a service charge

  1. Graham Thomas says:

    Hi Susan

    Yes, I think that you might have told us about your EC trip a couple of times before but such a momentous trip probably deserves a few more honourable mentions yet !!

    It’s nice to have your official confirmation that summer has arrived. It can be very confusing for the English to recognise this themselves and, to make life easier, I usually base my summer plans around the start of the Wimbledon fortnight.

    As you rightly say, it does seem strange to concentrate AML efforts on individual cash transactions over €15,000 as we are all too well aware that transactions will then be broken down into smaller amounts to get round these limits (e.g. the “smurfs” from your earlier post).

    Still, we can at least take some consolation from the fact that AML based legislation and controls have moved on a long way since the bygone era in which your excellent “Fatal Forgery” novel is based.

    Best Wishes

    Graham

  2. Hi Graham
    How clever of you to use your comment to mention “Fatal Forgery” – what with your lovely review on Amazon and now this, I might have to take you on as my agent!
    And AML was but a dim flicker in regency days – for Sam’s next adventure, I am thinking of having him lock horns with an organised crime figure…
    But I am still very annoyed that we’re not getting services into our definition of HVDs – if I were a criminal, that’s where I would focus for getting rid of my cash.
    Best wishes from Susan

  3. Graham Thomas says:

    Hi Susan

    I’d be very happy to act as your agent. There’s just the small matter of my fees to sort out first though and, of course, I’d prefer that these be payable in cash !!

    Best Wishes

    Graham

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s