Thoroughly Modern Piggies

So tell me: what did you do this weekend?  Sit in the garden?  Sail to France?  Slap a few prawns on the barbie?  I did none of these: instead, I sat at my desk, surrounded by the new Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, wielding a red pen, and updated five piggy books.

But let’s start at the beginning.  On Friday I was minding my own business, writing an article, when an email came in announcing that HMT had put out a press release about the new Regs.  “Crack down on terrorist and criminal financing”, said the headline. “Terrorists and criminals will find it harder to move money through the UK financial system thanks to new rules coming into force on 26th July 2017.”  I did a double-take: July?  Had we missed the deadline by exactly a month?  Was it normal to bring out new Regs on a Wednesday?  Or was it a misprint?  I called everyone I could think of at HMT – barring Gladstone, the Treasury cat, who never gives much away – and eventually tweeted them.  After an exciting hour, it was confirmed that it was indeed a typo, and that we were all systems go for the MLD4-sanctioned deadline of 26 June.

As for the major changes, well, I don’t want to spoil your fun as you hunt for them yourselves, but there’s a lot about risk assessment (the government must do a national risk assessment, supervisory bodies must do sectoral risk assessments, and firms’ in-house risk assessments must take these external ones into account).  “Where appropriate with regard to the size and nature of the business” you must: appoint a Board member or similar senior person to be responsible for AML/CFT compliance (and give their name to your regulator); and establish an internal audit function to check your AML/CFT efforts.  If you can’t identify a beneficial owner, you must keep records of all your attempts to do so – I’m really not happy with this one.  There’s plenty of information about EDD – when it must and could be applied, what it must and might entail, etc.   And then there’s that change to record-keeping that I highlighted before, with one small alteration: if you’re looking at transaction records in the context of a client relationship, you must keep them for ten years, or for five years after the end of the relationship, whichever comes first.

The piggies, as I say, are all updated and raring to go – forgive the plug, but now that I’ve spent a whole weekend force-feeding them the new Regs, I want to see them flourish.  Thanks to the magic of print-on-demand publishing, there are no piles of old stock lying around – in a rather fairytale way, no piggy exists until someone orders him.  The link to the updated piggy for UK NEDs can be found here, and the updated four piggies for staff in the UK regulated sector (accountancy, banking, insurance and investment versions) can be found here.

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10 Responses to Thoroughly Modern Piggies

  1. Claire says:

    There is a very big change for real estate – buyers are now to be considered clients under the regulations. Not sure how everyone is going to deal with this, especially in relation to timing. At what point does one become the buyer? At viewing, reservation, exchange?

    Please write a Piggy for real estate!

    • Welcome to the blog, Claire, and thank you for your comment. According to Regulation 4(3) of the new Regs: “an estate agent is to be treated as entering into a business relationship with a purchaser (as well as with a seller), at the point when the purchaser’s offer is accepted by the seller”. So that seems to be the point at which everything AML should kick in with regard to that particular client.

      I have considered an estate agency piggy, but I have so few estate agency clients, and so little interaction with estate agents on this blog and via Twitter, that I came to the conclusion that although they are covered by the Regs, they are taking care of things in-house. This new change may light a fire under some of them… I’ll certainly consider it.

      Best wishes from Susan

    • Hello again Claire. I have had a think about this, and I have decided to take a punt on an estate agency piggy. I’ve just ordered the cover, and will get cracking ASAP on the inside… So watch this space (and spread the news to all your friends in the UK estate agency sector).
      Best wishes from Susan

  2. splendissima says:

    So you have Schrodingers Piggies that do not exist until someone looks for them?

  3. And when I say “four piggies for staff in the UK regulated sector”, I now of course mean five! The new sty-mate is a piggy for estate agents. I considered it before but there didn’t seem to be much demand – but the clarification in the new Regs about the very-much-includedness of estate agents on both sides of the transaction will surely make them think again.

    The link is on the right, towards the top, or indeed here:

  4. Nick Smith says:

    Hi Susan, I have started feverously rehoming the new piggies, but have noticed that the cover is the same as the old piggies, do you think we could have something like ‘2017 Edition’ added to the cover?


    • Hi Nick
      How very kind of you – they’re keen to get to their new homes!
      And I know it would be helpful to have a different cover, but to change it – even just to have a “2017” splash across it – would cost me a hundred pounds per piggy… The way to be sure is to look at the copyright notice at the start of the book: it will say 2017. And on the Amazon listings I have tried to make it clear at the start of the description. In an ideal world I would have made that change, but I baulked at the cost of £500!
      Best wishes from Susan

  5. Pingback: Standing my AML ground | I hate money laundering

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