Money laundering

Introduction

Money laundering is the processing of criminal proceeds (cash and assets obtained from criminal activities) to disguise their illegal origin. It is a world-wide problem and governments have been taking major steps in recent years to combat it.

Money laundering has been treated as a very serious offence since the passing of the Criminal Justice Act in 1994. The Criminal Justice (Money Laundering and Terrorist Financing) Acts 2010 and 2013 update Irish anti-money laundering and terrorist financing legislation and brings it in line with the requirements of the third EU Anti-Money Laundering Directive (2005/60/EC). Ireland will be required to transpose the fourth EU Anti-Money Laundering Directive (2015/849/EU) into Irish law.

Ireland is also obliged to implement certain recommendations of the Financial Action Task Force (FATF) the international anti-money laundering and anti-terrorist financing body.

Rules

What is a money laundering offence?

Section 7 of the Act defines a money laundering offence in terms of property that is the "proceeds of criminal conduct".

Money laundering offences are committed where a person knows or believes (or is reckless as to whether or not) that the property represents the proceeds of criminal conduct and the person is involved in:

  • Concealing or disguising the true nature, source, location, disposition, movement or ownership of the property
  • Converting, transferring, handling, acquiring, possessing or using the property or
  • Removing the property from, or bringing the property into, the State

What is a “designated person”?

The Act places obligations on designated persons to guard against their businesses being used for money laundering or terrorist financing purposes.

Section 25 of the Act defines the term ‘‘designated person’’ as any person working in Ireland in any of the following capacities:

  • A credit or a financial institution (this includes funds and fund service providers, money lenders and money transmission or bureaux de change businesses) unless specifically excepted
  • An auditor, external accountant or tax adviser
  • A relevant independent legal professional
  • A trust or company service provider
  • A property service provider
  • A casino*
  • A person who directs a private members club at which gambling activities are carried out
  • A person trading in goods in respect of transactions involving the receipt of cash of at least €15,000
  • Any other person of a prescribed class

*Casinos are currently illegal in Ireland but they have been included on the list above as a result of judgements of the European Court. These judgements found that even though casinos are illegal in Ireland, EU member states must still ensure all provisions of the money laundering directive are set down in national law.

The Act also establishes a number of competent authorities who monitor designated persons and secure compliance with the requirements of the Act.

What are the obligations of designated persons?

Designated persons must:

  • Apply customer due diligence (for example, identify customers or beneficial owners),
  • Report suspicious transactions to An Garda Síochána and Revenue and
  • Have specific procedures in place to prevent money laundering and terrorist financing

Customer due diligence obligations are designed to make it more difficult for businesses to be used by for criminal money laundering or terrorist financing.

The legislation on money laundering requires that if you open a bank account you will need to provide proof of your identity. You may also be asked other questions, for example, about the origin of funds and the nature of your business. You can visit the Competition and Consumer Protection Commission's website for more information on opening a bank account in Ireland.

Anti-Money Laundering Compliance Unit

The Anti-Money Laundering Compliance Unit (AMLCU) has been established within the Department of Justice and Equality. The AMCLU administers and monitors designated persons that are assigned by the Act to the Minister for Justice and Equality. These include:

  • Auditors, external accountants, and tax advisers who are not already supervised by a designated accountancy body, the Law Society of Ireland or the General Council of the Bar of Ireland
  • Trust or company service providers (if the person is a member of a designated accountancy body, the designated accountancy body will be the competent authority)
  • Private members' gaming clubs (a person who effectively directs a private members’ club at which gambling activities are carried on, but only in respect of those gambling activities)
  • Any business trading in goods where cash payments of €15,000 are accepted. This sector is diverse and covers businesses from antique dealers, boat and car sales to dealers in precious stones and jewellers.

Monitoring involves inspections of designated persons to ensure that they are meeting their requirements under the Act. These inspections are undertaken by authorised officers appointed by the Minister.

Penalties

A conviction on charges of money laundering carries a maximum penalty of 14 years imprisonment.

It is also an offence for a person to provide advice or assistance to anyone engaged in money laundering.

Where to apply

Anti-Money Laundering Compliance Unit

Department of Justice and Equality
94 St. Stephen's Green
Dublin 2

Tel:(01) 602 8400
Homepage: http://www.amlcu.gov.ie/
Email: antimoneylaundering@justice.ie

Page edited: 9 November 2016