Anti Money Laundering & Combatting Terrorism Financing

THE WWFT SUPERVISOR  AUDITING YOUR COMPANY

The Dutch act regarding anti-money laundering and combating terrorism financing is called “Wet ter voorkoming van witwassen en financieren van terrorisme” and abbreviated Wwft.

It is becoming increasingly important for companies to be able to show that they are doing business with reliable counterparties. The Anti-Money Laundering and combatting Terrorist Financing Act (Wwft) aims to prevent Wwft institutions and their clients from doing business with persons, companies or countries with criminal or terrorist intentions. Companies must conduct a risk-based client due diligence investigation and report unusual transactions to the Financial Intelligence Unit (FIU) of the Tax Authorities. The Wwft is based on the European anti-money laundering guidelines.

STRICTER SUPERVISION

Compliance with the Wwft is increasingly being monitored by the Wwft supervisors: De Nederlandse Bank (DNB), the Netherlands Authority for the Financial Markets (AFM), Bureau Financieel Toezicht (BFT) and the Bureau Wwft of the Tax authorities.

More and more frequently they audit companies, often without notice. If companies do not meet their legal obligations, they risk a hefty fine, a penalty or even criminal prosecution.

DOES YOUR COMPANY FALL UNDER WWFT SUPERVISION?

The following institutions are covered by the Wwft and must conduct customer due diligence and report unusual transactions:

banks; credit institutions; securities investment firms; investment institutions; money transaction offices (exchange institutions); providers for money transaction offices; life insurers; insurance intermediaries who mediate in life insurance; credit card companies; casinos; traders in high value goods; other traders; accountants; lawyers; business advisers; tax advisers; real estate brokers; real estate agents; notaries; independent legal advisors; trust offices; investment firms; branches of financial companies with their registered offices abroad; payment service agents; payment service providers; electronic money institutions; natural persons, legal person or company that provides an address or postal address professionally or commercially; and appraisers.

HELP WITH PROBLEMS WITH SUPERVISORS

Under political pressure, regulators are becoming increasingly active when performing their investigations at Wwft institutions.

Do you need help and / or support during, or after, a supervisor’s investigation? Please contact us.

AID FOR IMPLEMENTATION / DRAFTING WORK POLICY (Money Laundering and Terrorist Financing Act)

Wwft institutions must have an internal policy with regard to the implementation of the Wwft.

A lot has changed as a result of the implementation of the European 4th Anti-Money Laundering Directive in the Wwft 2018 and the Wwft Implementation Regulations. In many cases, Wwft institutions still have to adjust their policies.

These are the most important 4 changes:

1. Client research is mandatory. There are no more exceptions. The previously existing exemptions have been deleted and the possibilities for simplified client research are considerably limited. The law prescribes a risk-based (see also point 3.) approach which ultimately determines the depth of the investigation and the intensity of the control measures to be taken;
2. The UBO: Wwft requires identification. The definition of the UBO concept is therefore extensive. Previously it was not possible for certain legal entities, such as Foundations and Associations, to designate a UBO. This is no longer possible in the expanded definition of UBO. If no natural person can be designated as a UBO, senior managers will have to be designated as UBO. The definition of PEP has also been broadened and tightened up and therefore applicable to a larger group of individuals;
3. Obligation to draw up a risk analysis (at the level of the institution and the intended client) and, with the resultant consideration, whether a compliance function (2 line) and an audit function (3 line) are required for the institution. According to the Wwft 2018, this will have to be considered according to the nature and size of the company.
4. The instruments of the various Wwft supervisors have been expanded. For example, the fines have been increased across the board and the regulators may publish sanctions, fines and disciplinary decisions.

COMPULSORY TRAINING OF EMPLOYEES

Employees of Wwft institutions must be regularly trained about the operation of the Wwft and the institution’s own policy.

What can Booij Legal & Tax do for you?

1. TRAINING

• Providing various Wwft training courses for employees of institutions (Notary, Lawyers, Tax Advice Offices) with subsequent test (Level 1);
• Providing Wwft training for officials within the Compliance or Audit function or the partner responsible for this (Level 2).

2. SUPPORT or DRAWING up:

• Wwft policy and the associated risk analysis;
• procedures written on the characteristics of the institution (tailor-made);
• As well as the associated checklists and forms;
• A plan of action with regard to “current files” that will eventually have to comply with the new Wwft.

3. SUBSCRIPTION for:

• (International) client investigation / sanction screening;
• Periodic updates with regard to legislation / case law / regulations / newsletter and workshops;
• Annual WWFT review – this review assesses your office policy and its implementation and makes recommendations for improvement;
• Answering general questions regarding the Wwft;
• Access to the Booij Legal & Tax database with relevant standard Wwft documents.

4. Of course Booij Legal & Tax can also help you with:

• Legal issues;
• Reports of unusual transaction to be submitted to the FIU;
• Individual / one-off client investigation;
• Assistance with investigations of Wwft supervisors or the FIOD;
• Advice on Mandatory Disclosure coherence (DAC 6) and “aggressive tax planning/ structuring”.