Some while ago I wrote about a draft of the Fourth Money Laundering Directive that had sneaked in a much-extended definition of “high value dealers”. What this earlier draft said was that HVDs would be “other natural or legal persons trading in goods or services, only to the extent that payments are made or received in cash in an amount of €7,500 or more”, and the point I made was that although we were all familiar with art auction houses and fancy car showrooms, no-one had said much about those who trade in services for cash – which could include universities (selling education services), clinics (selling medical services) and brothels (you get the picture – but do try not to).
But perusing the now-all-but-final version of MLD4 – we’re waiting for the final signature, which I am given to understand is merely a formality, and all the horse-trading is over – I see that HVDs are back to their original (i.e. MLD3) form: “Natural and legal persons trading in goods should be covered by this Directive to the extent that they make or receive cash payments of €10,000 or more.” So out go the universities, clinics and brothels – which is a shame from a theoretical perspective (as I was looking forward to seeing which regulator would be tasked with overseeing our houses of ill repute) and from the crime prevention perspective (as I am sure criminals do launder money through such unregulated and therefore naïve places) but I can understand why the legislators backed away from it. They do allow individual governments to adopt, if you will, an alternative position: “Member States should be able to adopt lower thresholds, additional general limitations to the usage of cash and further stricter provisions.” But I think we must accept that it is a rare parliamentarian who will vote for legislation requiring CDD checks to be done on their clients by the very establishments of which he and his colleagues might be enthusiastic patrons. I mean clinics and universities, of course.