by John McCarthy Consulting Ltd. | May 19, 2023 | News
One of the biggest problems that people face is that the legislation, which is the Criminal Justice (Money Laundering and Terrorist Financing) Acts 2010 to 2021, does not define the term ‘suspicion’.
When it comes to reporting people that they think may be suspicious they feel that they’re not quite certain whether what they’re feeling is actually a suspicion. The very nature of a suspicion is that it is an emotion and therefore very personal, and it can be difficult to give any hard definitions of the word.
It may be helpful to look at a spectrum of potential definitions of the word, which may range in order of certainty from:
- Curiosity
- Unease
- Doubt
- Concern
- Suspicion
- Belief
- Knowledge
One should also be careful to remember that thanks to the personal nature of suspicion, it doesn’t have to be shared. So just because person X is suspicious doesn’t mean that person Y should also be. And just because person Y is not suspicious doesn’t mean that person A should not be.
For example, you might be uneasy about something that a client does, and so you discuss it with a colleague. The tipping-off offence does not necessarily stop you doing this because it’s only relevant once you know or suspect that a report of money laundering suspicion has been made, and if you do not know or suspect this, you cannot tip off.
After the chat with your colleague, you find that you have now moved up the scale from unease to suspicion. Your colleague, on the other hand, is not worried. It would be very foolish, not to say potentially criminal, of you not to report your suspicion on the basis that your colleague is not suspicious.
You should have confidence in your own interpretation of a situation and not be put off taking the correct action just because no one else seems to share your concerns.
Having a suspicion of money laundering or terrorist financing and not reporting it is a serious offence. The legal obligation is quite simple: if you’re suspicious, you must make a report to your MLRO.
‘if you’re suspicious, you must make a report to your MLRO*’
(From the book ‘Anti-Money Laundering – What You Need to Know UK Banking Edition’ by Susan Grossey (Thinking About Crime Ltd.)’
Please go to our website to see our new ISQM TOOLKIT or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard, please contact John McCarthy FCA by e-mail at john@jmcc.ie.
We typically tailor training and brainstorming sessions to suit your firm’s unique requirements.
Publications and AML webinars:
- The ISQM TOOLKIT 2022 is available to purchase here.
- See our latest Anti-Money Laundering Policies Controls & Procedures Manual (March 2022) – View the Table of Contents click here.
- Also we have an updated AML webinar (March 2022) available here, which accompanies the AML Manual. It explains the current legal AML reporting position for accountancy firms and includes a quiz. Upon completion, you receive a CPD Certificate of attendance in your inbox.
- To ensure your letters of engagement and similar templates are up to date visit our site here where immediate downloads are available in Word format. A bulk discount is available for orders of five or more items if bought together.
by John McCarthy Consulting Ltd. | Mar 7, 2022 | Blog, News
On Friday 4 March 2022 the Consultative Committee of Accountancy Bodies in Ireland (CCAB-I) issued updated guidance applicable to accountants in practice for immediate use.
The Guidance is a widely respected and hugely valuable document among accountants as it sets out the minimum criteria that must be adhered to in order to comply with the Criminal Justice (Money Laundering and Terrorist Financing) Acts 2010 to 2021 (‘the Act’) in the Republic of Ireland.
Key changes in the legislation are reflected in additional guidance in areas such as:
- Greater emphasis on identification of beneficial owners of businesses;
- Expanding the definition of tax adviser, letting agent and intermediaries at art auctions;
- The definition of a Politically Exposed Person (PEP) to include any individual performing a prescribed function;
- There is a specific list of enhanced due diligence measures that the designated person is required to apply when dealing with a customer established, or residing, in a High-risk third country;
- The new requirement in place since 23 April 2021 that prior to commencing a business relationship is established, reasonable steps must be taken to verify the beneficial ownership of corporate clients including confirming the beneficial ownership with the relevant Central Register. Where a Designated person identifies a ‘discrepancy’ (as defined) in the Act, i.e. where the entry is inconsistent or incorrect between its own records and those maintained by the Central Register, it must notify the relevant Registrar.
- There is a similar requirement to notify the relevant Registrar where there is evidence of ‘non-compliance’ (as defined) in the Act, i.e. where the register is blank, it must notify the relevant Registrar.
A copy of the guidance may be accessed here.
Specially tailored up to date AML Training that meets the requirements of the legislation is available on request, on Zoom, in person or as a hybrid event, with a free video recording supplied afterwards, for future viewing. Contact john@jmcc.ie for further details.
To ensure your letters of engagement and similar templates are up to date visit our site here where immediate downloads are available in Word format. A bulk discount is available for orders of five or more items if bought together.
For our latest Audit Quality Control Manual (October 2021) (implementing the latest Irish Audit & Accounting Supervisory Authority standards including ISQC1 on audit quality control) click here. View the Table of Contents here.
We also have an up to date Anti-Money Laundering Procedures Manual (September 2021) – View the Table of Contents click here.
by John McCarthy Consulting Ltd. | Feb 21, 2022 | Blog, News
Have you checked what companies are registered at your office address, lately? Well, maybe now is a good time!
Police sometimes describe the practice by which drug dealers take over someone’s home (often a vulnerable person) as a base for their activities as ‘cuckooing’. It now appears that this phenomenon has ‘come home to roost’ in some accountancy firms – at least in the UK.
According to a 2021 report in the SARS in Action magazine of the National Crimes Agency the new style of cuckoo uses an accountancy firm’s address as a registered office address without the knowledge or consent of the firm.
The most likely explanation for using the accountancy firm’s address is that it provides credibility which may be used to facilitate fraud. In many cases, the company will combine using the address with a Post Office redirection arrangement so the accountancy firm will not receive any mail which might trigger an investigation.
And it gets worse. Sean Kavanagh from leading company formation agency, Company Formations International in Ballsbridge explains that it is impossible to have a fraudulent Registered Office removed from your address as the CRO do not have any legislative basis for doing so, and therefore don’t.
CRO personnel went before the Oireachtas Committee for Enterprise, Trade and Employment to discuss this and other anomalies including full blown identity theft in December 2021. We still await some positive developments from this meeting.
You have been warned!
To ensure your letters of engagement and similar templates are up to date visit our site here where immediate downloads are available in Word format. A bulk discount is available for orders of five or more items if bought together.
For our latest Audit Quality Control Manual (October 2021) (implementing the latest Irish Audit & Accounting Supervisory Authority standards including ISQC1 on audit quality control) click here. View the Table of Contents here.
We also have an up to date Anti-Money Laundering Procedures Manual (September 2021) – View the Table of Contents click here.
by John McCarthy Consulting Ltd. | Feb 21, 2022 | Blog, News
There is currently no specific modern legislation dealing with co-operatives in Ireland. The Industrial and Provident Societies (IPS) Acts 1893-2021 come from another century and do not mirror up to date company law principles. Currently there are 960 Industrial and Provident Societies registered, comprised mainly of various agricultural co-operatives, group water schemes and housing co-operatives.
There are many aspects of good practice set out in company law (in the Companies Act, 2014) that are applicable to co-operatives, either directly or with adaptation.
Consequently the Department of Enterprise, Trade & Employment commenced a consultation on 28 January 2022 on proposals to update the IPS legislation.
Amongst the proposals, it is intended that:
- The legislation will cross apply six parts of CA 2014, with amendments needed to adapt to the particular circumstances of co-operatives, relating to:
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-
- Examinership and
- Winding up (both of these are already cross-applied in the current IPS Acts);
- Investigations;
- Compliance and Enforcement,
- Receivers and
- Financial Statements.
- The legislation will generally replicate, with some amendments, provisions from other Parts of the Companies Act, 2014 i.e.
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-
- Directors’ Duties;
- Charges and Debentures and
- Functions of the Registrar.
- The legislation will also use the relevant parts of Companies Act, 2014 to give assurance to stakeholders in areas dealing with
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- Registration;
- Corporate Governance
- Mergers and
- Strike-off and Restoration.
There are just 12 questions in this consultation and the response deadline is 5pm this Friday 25 February 2022 and responses must be sent to coopconsultation@enterprise.gov.ie.
The full consultation (and response template) is available here.
To ensure your letters of engagement and similar templates are up to date visit our site here where immediate downloads are available in Word format. A bulk discount is available for orders of five or more items if bought together.
For our latest Audit Quality Control Manual (October 2021) (implementing the latest Irish Audit & Accounting Supervisory Authority standards including ISQC1 on audit quality control) click here. View the Table of Contents here.
We also have an up to date Anti-Money Laundering Procedures Manual (September 2021) – View the Table of Contents click here.
by John McCarthy Consulting Ltd. | Jan 11, 2021 | Blog, News
When you are doing your Client Due Diligence on a new client/customer, did you ever wonder where you could obtain a list of sanctioned or high-risk territories/jurisdictions?
Well, a reliable source is near at hand. The Financial Action Task Force (FATF) identifies jurisdictions with weak measures to combat money laundering and counter terrorist financing (AML/CFT) in two FATF public documents. These two reports identify:
These reports are issued three times a year in February, June, and October.
The FATF’s process to publicly list countries with weak AML/CFT regimes has proven to be effective. For example, as of October 2018, the FATF had by then reviewed over 80 countries and publicly identified 68 of them. Of these 68, over 80% have since made the necessary reforms to address their AML/CFT weaknesses and have been removed from the process.
The first public document, the FATF’s Public Statement, identifies countries or jurisdictions with such serious strategic deficiencies that the FATF calls on its members and non-members to apply counter-measures. These include enhanced due diligence measures proportionate to the risks arising from the deficiencies associated with the country.
The statement “Improving Global AML/CFT Compliance: On-going process” identifies countries or jurisdictions with strategic weaknesses in their AML/CFT measures, but that have provided a high-level commitment to an action plan developed with the FATF. The FATF encourages its members to consider the strategic deficiencies identified for these jurisdictions.
If any country fails to make sufficient or timely progress, the FATF can decide to increase its pressure on the country to make meaningful progress by moving it to the Public Statement.
For more information about the FATF’s process to identify high-risk and non-cooperative jurisdictions and monitor their progress, click here.
Watch out for our 2021 update to the AML Policies & Procedures Manual coming soon.
For a complete list of our time-saving engagement letter templates for FRS 102 audit, FRS 102 audit-exempt, VAT, visit our store here. All our engagement and representation letter templates are up to date for Brexit and Covid 19.
