The Brexit bonanza for baddies

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.

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5 Responses to The Brexit bonanza for baddies

  1. CDWOS says:

    Whilst I understand your frustration and exasperation at the political vested interest games playing of your political masters who no longer appear to represent their constituents in any way shape or form and have turned the UK into an international laughing stock I think that you may be a touch over pessimistic. The UK Law Enforcement information and input in to all and any EU databases is much prized as in the main it is far more accurate, organised and comprehensive than much of what our European brethren can come up with so there is an argument like everything else to do with Brexit that it is not all the preamble to the end of the World. The EU in its many forms needs to do business (in the broadest sense) with the UK at every level and simply because some puffed up over self indulgent and self-interested EU politicians still have to make the mental leap to the 21st century(real world) is not going to stop business as usual at the grass roots. As the mayor of Calais said nothing will change to the freeflow of traffic and business regardless of the deal. It is too important to them to keep things as they are……………the French thankfully despite their posturing have always been fairly pragmatic where their interests are concerned. Here endeth the Brexit diatribe!!

    • I can’t help thinking that no matter how pragmatic our European police neighbours might be about continuing to work together, if it’s not part of a formal agreement, sharing of information might not work as smoothly as it could. And won’t sharp lawyers get on their high horses about admissibility of evidence gathered through informal channels? Continuing to sell food to each other is one thing; participating in international investigations that have to be held to high standards in court is another, I fear. And criminals will be the first to cry, “You can’t use that information – it wasn’t obtained in accordance with information-sharing legislation!”

      • CDWOS says:

        You make a very fair point particularly about the criminals ‘claiming their rights’ and the violation of such. I find it difficult to accept that cooperation (such as it has been) is simply going to stop when it has benefitted all parties concerned.

  2. Robert J Long says:

    I am sure the European Research Group of MP’s are looking forward to stripping away AML framework as part of their mad little economic death/cargo cult belief that removing all regulation (for which read consume protections and standards) will somehow make us all wealthy and safer. They do seem to be of a “all foreign investment is good…even if it is laundered proceeds” mindset , but then again that seemed to be the government attitude while various wealthy PEPs brought most of west London up.

    On the law enforcement front, mixed bag. We will no doubt come to an arrangement with most of those bodies and countries, we do have something to offer them in return. And on a individual Officer level we all (be us French, Polish, Macedonian, German or British) want catch the ne’r-d-wells, we will try make any system “work” even if it is a bit rough and ready (to be fair if the best a criminal defence team has is “but that is Foreign material you don’t have a sharing agreement with” then we are doing alright). But it does all seem so needless in the first place (Which I think sums up Brexit to be honest…needless.

    As a aside I have to say that if one absolutely had to Brexit, if you really, really had to do it, then these are the sort of issues you have a jolly good think about and get things in place for, BEFORE you give Article 50 notification and start a two year clock on yourself. Now everything form crime fighting co-operation to data standards are being made up as we go along with not time to get it right. Sign.

    • It’s madness from start to finish – launched by a self-serving schoolboy and shepherded by a monomaniacal PM. The truly awful luck of it all was the timing: it’s happened while neither of the opposition parties has a spine.

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