John Binns on new economic crime levy – Money Laundering Bulletin

John Binns on new economic crime levy – Money Laundering Bulletin

BCL partner John Binns writes for Money Laundering Bulletin with his article titled ‘Will the levy break, or break you first?’.

Here’s an extract from the article:

“Rishi Sunak’s budget already seems a world away, and doubtless many of his announced measures will now take some time to come to fruition, or possibly be abandoned altogether. Doubtless many in the UK regulated sector will wish the latter fate on the Anti-Money Laundering (AML) Levy, the idea of charging a fee to firms that operate in the regulated sector, to help fund the fight against financial crime. As one of the few measures aimed at raising revenue for an already cash-strapped area of state activity, albeit one with small and medium-sized enterprises in its sights, it seems prudent to consider its planned consultation to be just around the corner. When it appears, there are major questions about the principle and the detail to be answered.

The first fundamental question, of course, is why it should be the businesses in the regulated sector rather than the state that should have to fund the fight against financial crime. The idea of the sector is that these businesses are the gatekeepers to a financial and economic system that is open to abuse by money launderers and terrorist financiers, who are therefore asked to adopt measures to detect and disrupt their activities, such as conducting due diligence on their customers and making Suspicious Activity Reports (SARs) to the National Crime Agency (NCA). The core members of the sector remain banks and other financial institutions, who submit the vast majority of SARs. Alongside them are the designated non-financial professional bodies (DNFPBs, although curiously neither the phrase nor its abbreviation have ever really caught on), which include accountants, lawyers, when dealing with commercial or property transactions, estate agents, tax advisers, and now art market participants, crypto-asset businesses, and letting agents, when dealing with amounts above a certain threshold.”

This article was originally published by Money Laundering Bulletin on 17th March 2020. You can read the full version here via pdf or on their website.

John Binns is a partner at BCL, specialising in business crime and proceeds of crime. Most of his cases involve an international element, and he has advised clients on appeals to the CJEU in the context of international corruption allegations and targeted financial sanctions.