You have probably guessed from recent tear-stained posts that I am not a fan of Brexit. Having lived an international life surrounded – very happily – by people from all over the world, I rear up at the thought of immigration controls. Having lost five great-uncles to war, I am thankful every day for the seventy years of peace engineered by the EU. And having seen the unbelievable shambles created by the UK parliament over the past two years, I would pay anything to give back control to Brussels. But those are just personal preferences: my professional life is another matter. And I think that most AML-ers are of the view that leaving the EU will prove a bonanza for those who wish to launder money through the UK.
For a start, if we leave the EU we will be drummed out of Europol. This is bad enough for those law enforcement agents who have spent a career building up networks and alliances in the Europe-wide crime-fighting community, but it also means that we will be excluded from Europol’s database – the Europol Information System. This is bursting at the seams with juicy information from all EU Member States, whose police forces can search it to find links and connections and relationships. An investigator in the National Crime Agency in their secret London HQ (don’t tell anyone, but it’s in Vauxhall) can log onto the EIS and see whether their suspect has any financial presence anywhere in the EU, or whether he is sending money to an account in the EU, or whether his passport has been used as ID verification in a bank or airport or hotel in the EU. Quite handy, you might think. Of course there is talk of the UK negotiating apparently favourable information-sharing agreements with all of its EU neighbours individually but let’s be realistic: that’s going to take ages, we’ve not shown ourselves to be particularly skilled at such negotiations, and *stamps little feet* it won’t be anywhere near as good as being able to have a rootle around in the EIS.
Then there is our AML legislation. At the moment we operate under the Money Laundering Regulations 2017, which are our domestic answer to the Fourth Money Laundering Directive. This is, as far as I am concerned, Exactly As It Should Be. MLD4 is not perfect, but no-one could accuse those involved in its creation of not exploring the subject, or not debating the issues, or not listening to all concerns, or not being prepared to run through several drafts. And it presents a united front – which we know is anathema to criminals, who live to sniff out differences that they can exploit in international legislation. When it comes to an international crime, you need an international approach – and MLD4 is certainly that. According to the (as yet draft) Money Laundering and Transfer of Funds (Information) (Amendment) (EU Exit) Regulations 2018 – which will come into force if we leave the EU – things in the UK will continue in the vein of MLD4 for a while: “in the definition of ‘fourth money laundering directive’, at the end, insert ‘as it had effect on 26th June 2017’”. But what then? )You will notice that the amendment regs make no mention of the Fifth Money Laundering Directive, which supposedly we will be implementing.) Will we – in the immortal words of Fleetwood Mac – go our own way? Frankly, I feel a thousand times safer with AML legislation that has been considered, debated and drafted by an informed group of concerned representatives from EU countries than with whatever will be produced by the four people who are left in HMT after Brexit, charged with doing whatever it takes to keep the UK economy afloat. “I know,” one of them might say, “let’s make the UK a more welcoming financial jurisdiction by cutting red tape, getting rid of all that EU-inspired due diligence nonsense, and opening the doors to overseas investors.” Give me strength. And now, if someone could give me a hand, I will clamber down from my soap-box.