Sectoral guidelines for money remitters – S+P Consulting

Sectoral guidelines for money remitters – S+P Consulting
EBA has published the final Guidelines under Articles 17 and 18(4) of Directive (EU) 2015/849 on simplified and enhanced customer due diligence. The Risk Factors guidelines give an overview on the factors credit and financial institutions should consider when assessing the money laundering and terrorist financing risk associated with individual business relationships and occasional transactions.
Sectoral guidelines for money remitters

Sectoral guidelines for money remitters

128.
Money remitters are payment institutions that have been authorised in line with Directive 2007/64/EC to provide and execute payment services throughout the EU. The businesses in this sector are diverse and range from individual businesses to complex chain operators.
129.
Many money remitters use agents to provide payment services on their behalf. Agents often provide payment services as an ancillary component to their main business and they may not themselves be obliged entities under applicable AML/CFT legislation; accordingly, their AML/CFT expertise may be limited.
130.
The nature of the service provided can expose money remitters to ML/TF risk. This is due to the simplicity and speed of transactions, their worldwide reach and their often cash- based character. Furthermore, the nature of this payment service means that money remitters often carry out occasional transactions rather than establishing a business relationship with their customers, which means that their understanding of the ML/TF risk associated with the customer may be limited.
131.
Money remitters should consider the following risk factors and measures alongside those set out in Title II of these guidelines.
 

Sectoral guidelines for money remitters – Risk factors

Product, service and transaction risk factors
132.
The following factors may contribute to increasing risk:

  • the product allows high-value or unlimited-value transactions;
  • the product or service has a global reach;
  • the transaction is cash-based or funded with anonymous electronic money, including electronic money benefiting from the exemption under Article 12 of Directive (EU) 2015/849;
  • transfers are made from one or more payers in different countries to a local payee.

133.
The following factor may contribute to reducing risk:

  • the funds used in the transfer come from an account held in the payer’s name at an EEA credit or financial institution

Sectoral guidelines for money remitters – Customer risk factors  

134.

The following factors may contribute to increasing risk:  

• The customer’s business activity:

  1. The customer owns or operates a business that handles large amounts of cash.
  2. The customer’s business has a complicated ownership structure.
  • The customer’s behaviour:
  1. The customer’s needs may be better serviced elsewhere, for example because the money remitter is not local to the customer or the customer’s business.
  2. The customer appears to be acting for someone else, for example others watch over the customer or are visible outside the place where the transaction is made, or the customer reads instructions from a note

3. The customer’s behaviour makes no apparent economic sense, for example the customer accepts a poor exchange rate or high charges unquestioningly, requests a transaction in a currency that is not official tender or commonly used in the jurisdiction where the customer and/or recipient is located or requests or provides large amounts of currency in either low or high denominations.
4. The customer’s transactions are always just below applicable thresholds, including the CDD threshold for occasional transactions in Article 11(b) of Directive (EU) 2015/849 and the EUR 1 000 threshold specified in Article 5(2) of Regulation (EU) 2015/847.29 Firms should note that the threshold in Article 5(2) of Regulation (EU) 2015/847 applies only to transactions that are not funded by cash or anonymous electronic money.
5. The customer’s use of the service is unusual, for example they send or receive money to or from themselves or send funds on immediately after receiving them.
6. The customer appears to know little or is reluctant to provide information about the payee.
7. Several of the firm’s customers transfer funds to the same payee or appear to have the same identification information, for example address or telephone number.
8. An incoming transaction is not accompanied by the required information on the payer or payee.
9. The amount sent or received is at odds with the customer’s income (if known).
135.
The following factors may contribute to reducing risk:
• The customer is a long-standing customer of the firm whose past behaviour has not given rise to suspicion and there are no indications that the ML/TF risk might be increased.  

• The amount transferred is low; however, firms should note that low amounts alone will not be enough to discount TF risk.  

 

Sectoral guidelines for money remitters – Distribution channel risk factors  

136. The following factors may contribute to increasing risk:

• There are no restrictions on the funding instrument, for example in the case of cash or payments from E-money products that benefit from the exemption in Article 12 of Directive (EU) 2015/849, wire transfers or cheques.  

• The distribution channel used provides a degree of anonymity.  

• The service is provided entirely online without adequate safeguards.

• The money remittance service is provided through agents that:

i. represent more than one principal;

ii. have unusual turnover patterns compared with other agents in similar locations, for example unusually high or low transaction sizes, unusually large cash transactions or a high number of transactions that fall just under the CDD threshold, or undertake business outside normal business hours;  

iii. undertake a large proportion of business with payers or payees from jurisdictions associated with higher ML/TF risk;

iv. appear to be unsure about, or inconsistent in, the application of group-wide AML/CFT policies; or

v. are not from the financial sector and conduct another business as their main business.

• The money remittance service is provided through a large network of agents in different jurisdictions.  

• The money remittance service is provided through an overly complex payment chain, for example with a large number of intermediaries operating in different jurisdictions or allowing for untraceable (formal and informal) settlement systems.

137. The following factors may contribute to reducing risk:  

• Agents are themselves regulated financial institutions.  

• The service can be funded only by transfers from an account held in the customer’s name at an EEA credit or financial institution or an account over which the customer can be shown to have control.

Sectoral guidelines for money remitters – Country or geographical risk factors

138.
The following factors may contribute to increasing risk:

  • The payer or the payee is located in a jurisdiction associated with higher ML/TF risk.
  • The payee is resident in a jurisdiction that has no, or a less developed, formal banking sector, which means that informal money remittance services, such as hawala, may be used at point of payment.

 

Compliance & Geldwäschebeauftragter – Sectoral guidelines for money remitters – S+P Consulting

Unsere Praxisseminare Geldwäsche und Fraud – BasisseminarGeldwäsche und Fraud – AufbauseminarGeldwäsche & Fraud – Update und Geldwäsche & Fraud – Forum verschaffen Ihnen einen umfassenden Überblick zu den aktuellen gesetzlichen Neuerungen und unterstützen Sie dabei, Geldwäsche- und Betrugsstrukturen zu erkennen, zu bewerten und rechtzeitig zu verhindern. In den Compliance-Seminaren wie ComplianceCompliance für VertriebsbeauftragteNeue Compliance-Funktion gemäß MaRisk oder auch Compliance im Fokus der Bankenaufsicht werden Ihnen die Ausgestaltung der Schnittstellen zwischen Compliance, Datenschutz, IT, Zentrale Stelle und Interner Revision näher gebracht. Auch die Mindestanforderungen zum Aufbau eines Gesamt-IKS werden hier beispielsweise näher erläutert.
Zudem haben Sie die Chance, nach Teilnahme der Seminare die Zertifizierungslehrgänge zum Compliance Officer, zum AML & Fraud Officer oder zum Geldwäsche-Beauftragter zu absolvieren.

Sectoral guidelines for money remitters

Leave a Reply

Your email address will not be published. Required fields are marked *