Criminal Finances Act 2017, No. 22 (as amended) (Corporate Criminal Offence (CCO))

The Criminal Finances Act 2017 is a piece of legislation in the United Kingdom aimed at combating financial crime, including money laundering and terrorist financing. It introduces measures designed to make it more difficult for criminals to use the financial system for illicit activities.

The primary purpose of the Criminal Finances Act 2017 is to enhance the UK's ability to detect and prevent financial crimes, particularly money laundering and terrorist financing. It provides legal tools and frameworks to hold both individuals and organisations accountable for facilitating or being involved in such activities.

The Act places several key requirements on organizations and individuals, including:

1. Anti-Money Laundering (AML) Compliance: Organisations must have robust AML policies and procedures in place. This includes conducting risk assessments, customer due diligence, and enhanced due diligence for high-risk customers.
2. Record Keeping: There is an obligation to maintain thorough records of customer transactions and due diligence for a specified period.
3. Suspicious Activity Reporting (SAR): Organisations are required to file SARs with relevant authorities when suspicious activities are identified.
4. Whistleblowing: The Act encourages the implementation of whistleblowing policies to facilitate the reporting of suspicious activities within organizations.
5. Sanctions Screening: Organisations should screen against global sanctions lists to ensure they are not engaging with sanctioned entities.
6. Compliance Officer: An organisation must appoint a designated compliance officer responsible for overseeing AML activities.

The Criminal Finances Act 2017 applies to a wide range of entities and individuals operating within or connected to the United Kingdom. This includes:

• Financial Institutions: Banks, credit unions, insurance companies, and other financial service providers.
• Professional Service Firms: Lawyers, accountants, and estate agents who provide services that can be exploited for money laundering purposes.
• Corporate Entities: Companies and partnerships conducting business in the UK, as well as subsidiaries and branches of foreign entities operating in the UK.
• Non-Profit Organizations: Charities and other non-profit entities are subject to certain provisions of the Act to prevent abuse for criminal purposes.
• Individuals: This can include directors, officers, and employees of organizations who may be personally liable for non-compliance.

In summary, the Criminal Finances Act 2017 is a comprehensive legal framework designed to combat financial crimes by imposing strict requirements on organisations and individuals involved in financial activities in the UK. It seeks to strengthen the UK's anti-money laundering and counter-terrorist financing efforts. Compliance with this Act is crucial for entities conducting business in the UK to mitigate legal and reputational risks associated with financial crimes.

The Criminal Finances Act 2017 imposes specific evidence requirements on organisations and individuals to demonstrate compliance with its anti-money laundering and counter-terrorist financing provisions. The Act aims to strengthen the UK's ability to combat financial crimes. Here is a summary of the key evidence requirements:

1. Anti-Money Laundering (AML) Policies and Procedures: Organisations must maintain documented AML policies and procedures outlining steps taken to prevent money laundering activities.
2. Risk Assessments: Conduct and document risk assessments related to money laundering and terrorist financing, tailored to the organization's specific operations.
3. Customer Due Diligence (CDD): Keep records of thorough customer due diligence checks, including identification and verification of customers, beneficial owners, and politically exposed persons (PEPs).
4. Enhanced Due Diligence (EDD): Maintain evidence of applying enhanced due diligence measures for high-risk customers and transactions.
5. Training and Awareness: Document training programs aimed at raising employee awareness of money laundering risks and compliance with the Act.
6. Suspicious Activity Reports (SARs): Keep records of filed SARs to relevant authorities in cases where suspicious activities are identified.
7. Record Keeping: Maintain records of customer transactions, communications, and due diligence for a statutory period specified by regulations.
8. Whistleblowing Policy: Have evidence of a whistleblowing policy and procedure encouraging employees to report suspicious activities internally.
9. Sanctions Screening: Maintain documentation of procedures for screening against global sanctions lists and records of any hits.
10. Third-Party Due Diligence: Keep records of due diligence conducted on third parties (e.g., vendors, partners, agents) to ensure compliance with AML requirements.
11. Transaction Monitoring: Maintain evidence of systems and processes in place to monitor transactions for unusual or suspicious activity.
12. Compliance Officer Designation: Document the appointment of a designated compliance officer responsible for overseeing AML activities.
13. Internal Controls and Policies: Keep documentation of internal controls and policies related to financial transactions and AML compliance.
14. Regulatory Reporting: Maintain evidence of timely and accurate reporting to relevant regulatory authorities as required by the Act.
15. Audit Trail: Keep records demonstrating an audit trail of AML activities, including any investigations conducted.
16. Regular Reviews and Updates: Document periodic reviews and updates of AML policies and procedures in line with regulatory changes and evolving risks.

These evidence requirements are critical for organisations to demonstrate their compliance with the Criminal Finances Act 2017. They help ensure that entities are taking appropriate measures to prevent and detect money laundering and terrorist financing activities within their operations. Consulting with legal and compliance experts can help ensure comprehensive compliance with the Act's provisions.