Reporting Procedures

Reporting Procedures

As you have learnt, one of the requirements under the Regulations is that organisations must maintain internal reporting procedures for preventing money laundering.

So, if you recognise a red flag or are worried about any aspect of a matter, and you believe the appropriate person is unaware of that information, you must immediately review and follow the organisation’s procedures and discuss the matter with the MLRO or other designated person. It will be up to them to advise you as to what you should do next. If you are unsure of your organisation’s procedures then you must speak to the relevant person immediately and ask for advice.

Keep it confidential

During this period, and subsequently, it is very important that the fact that a report has been made is kept entirely confidential, because if the ‘suspect’, who in this case is the client, learns of it and is able to hide the suspicious money or alter his intentions to avoid detection, the person who provides the suspect with the information may be guilty of prejudicing the enquiry against him and of tipping off.

You should also refrain from discussing a report with any third party or generally in the office.

NCA moratorium period

If the MLRO or other designated person decides to make a report to the NCA, the authority should give or refuse consent to continue with the transaction within seven clear working days (excluding bank holidays and weekends). If after seven working days, there has been no response from the NCA, consent to proceed on the basis of the information disclosed will be deemed to have occurred.

If consent is refused, the organisation must not proceed with the transaction for a period of 31 calendar days (known as the “moratorium period”), from the date of the refusal. Otherwise, the organisation risks committing a money laundering offence. Note: Under no circumstances should you report directly to the NCA yourself.

After you’ve made a report

In the meantime, you should take no steps to progress the matter without the consent of the MLRO or other designated person. The authorised disclosure defence will not apply if steps are taken in the transaction without consent.

Remember, in order to gain the protection afforded to you personally by the legislation, you MUST:

• strictly and fully observe the organisations’ reporting procedures
• keep confidential the fact that a report has been made – even within the office

Well done! You have completed Module 4 and should now be better equipped to spot suspicious transactions, instructions or other activities which may be related to money laundering or terrorist financing.