Explanatory Memorandum to the Anti-Money-Laundering Law of 18 September 2017 - Articles 45 and 46
One of the essential operational responsibilities of the anti-money-laundering compliance officer (AMLCO) designated in accordance with Article 9, § 2, of the draft Law consists of analysing atypical transactions detected during the ongoing due diligence (cf. draft Article 35, § 1, 1°) The objective of this analysis consists of determining if there is a suspicion of ML/TF or not, or reasonable motives for such a suspicion, and whether this gives rise to reporting the transaction concerned to the CTIF-CFI in accordance with draft Articles 47 et seq.
Where the AMLCO (or the persons acting under his/her authority) proceed(s) with this analysis, he/she must examine, as much as possible, the context and purpose of the transactions, in particular in the case of complex transactions for unusually high amounts or in the context of unusual processes with no apparent economic justification or legitimacy.
To proceed with this analysis of atypical transactions, the AMLCO shall firstly look into the results of the ongoing due diligence (cf. above). Nevertheless, the information he/she possesses in this respect may be insufficient to enable him/her to decide whether there is a suspicion of ML/TF. In this case, the second indent of § 1 imposes that the obliged entity must take (at the initiative of its AMLCO) the measures additional to those already applied as part of the ongoing due diligence and which appear necessary to be able to appreciate whether these transactions or activities seem suspicious or not. This provision transposes Article 18, § 2, 2nd sentence of the Directive that in this case requires specific enhanced due diligence which differs from the ongoing due diligence — where applicable increased — required under Articles 35 to 41 of this draft Law.
In all cases in which an atypical transaction is subjected to the analysis of the AMLCO, he/she must document the results of his/her analysis in a written internal report. This internal analysis report must in particular enable an understanding to be gleaned of the motives for which the AMLCO has decided that there is or is not a suspicion of ML/TF. However, because by virtue of Article 47, § 1, 1° it is not necessary for the report of a suspicion to identify the predicate criminal activity, it is equally not required that the analysis by the AMLCO and the written report that documents it identify this underlying criminality to conclude that the transaction concerned is suspect. However, it should be emphasised that such an internal report must be written whatever the decision made as to whether or not there is a suspicion of ML/TF and certainly as regards whether or not to report a suspicion to the CTIF-CFI. This report’s purpose is mainly to allow the decisions made by the AMLCO to be justified ex post and to allow the effectiveness and pertinence of the decision-making process to be monitored.
Whilst draft Article 45 concerns the case in which the transactions carried out or desired by a customer are qualified as atypical, Article 46 similarly regulates the cases in which, for whatever reason, the obliged entity is unable to fulfil its obligation:
- to identify or verify the identity of persons or legal arrangements involved in the business relationship or transaction (cf. draft Article 33);
- to identify the characteristics of the customer and the nature and purpose of the business relationship or occasional transaction (cf. draft Article 34, § 3); or
- to exercise ongoing due diligence on the business relationship (cf. draft Article 35, § 2).
In these cases, additional to the prohibition of entering into or maintaining the business relationship or carrying out the occasional transaction concerned, the obliged entity must examine, under the responsibility of its AMLCO, whether the causes of being unable to fulfil the obligations of due diligence are of a nature to give rise to a suspicion of ML/TF. This assumes that the obliged entity draws up and applies a mechanism of alerts to the AMLCO similar to that set out hereinabove as regards atypical transactions.
Just as is the case with the analysis of atypical transactions, that of the situations in which the obliged entity is unable to meet the obligations listed above should be the subject of a written report, whatever the decision made as regards the suspicious nature, or not, of the situation analysed and, consequently, as regards its communication, or not, to the CTIF-CFI.