Digital compliance technology.
What does the Money Laundering Act mean?
The Act on Measures against Money Laundering and Terrorist Financing (Money Laundering Act) is the administrative framework that applies to companies in certain sectors. The regulations aim to prevent companies from being exploited for money laundering and terrorist financing.
What obligations does a Business owner have?
An operator must annually carry out a general risk analysis of his/her own activities, in addition to training its personnel on an ongoing basis.
What can happen if you do not comply with the NIS2 directives?
Who is covered by the Money Laundering Act?
The new Money Laundering Directive from the EU covers an increasing number of industries and activities, including:
- Accounting and payroll consultants
- Fund, credit market and securities companies
- Insurance intermediaries and life insurance undertakings
- Company formation
- Estate agent
- Lawyers and associates
- Companies dealing in antiques, art, precious stones, scrap metals or means of transport
- Car dealers
You should always evaluate the general risk assessment
Before your company offers new or materially changed products or services, targets new markets or makes other changes that are relevant to the business. Make a note of the date of each assessment. If you believe that the risks in the business have changed, the documentary risk assessment must be updated accordingly
Who needs to follow the NIS2 directive?
Supplyer or delivery to:
- Banking operations
- Financial market infrastructure
- Delivery and distribution of drinking water
- Digital infrastructure
What does the law say?
The basis of the Money Laundering Act is that a company that is under supervision must have a risk-based approach. The basis of the work is that you have to know who you are doing business with.
1st step - find out which people are behind your customer. What is required is to find out the UBO (beneficial owner). When the people are identified, you must make an initial check against so-called sanction and PEP lists. These lists include companies and people identified as terrorists, money launderers or who are politically exposed.
The checks against the Swedish Companies Registration Office and the various lists must then be made on an ongoing basis.
If a person or company appears on sanction lists, this must be reported to the Financial Intelligence Unit.
What to do to comply with the Money Laundering Act?
The organizations, or operators, that are subject to the Act on Measures against Money Laundering and Terrorist Financing are obliged to carry out a risk assessment of their own company in which they identify the risks of products and processes and identify how these are shamed.
Operators shall also categorise their customers at risk by collecting sufficient information and identifying who controls the company, through ownership or otherwise. Because in the case of ownership, the owner(s) who own/control 25 percent should be identified and checked against sanction and PEP lists. The risk categorisation shall be updated with a periodicity reflecting the risk category assigned to the customer.
Surely fines only affect banks?
The Money Laundering Act covers a large number of industries and everyone under the law must meet a number of important requirements for routines and processes. And if you do not follow the law, the authorities have the opportunity to charge both smaller and larger sanction fees. In addition, if you have really big flaws, an accountant, lawyer or accounting consultant can get rid of your authorization.
Since last year, there is a coordination function for measures against money laundering and terrorist financing. The police coordinate and sixteen authorities participate, including the County Administrative Board, the Swedish Financial Supervisory Authority, the Real Estate Agency Inspectorate, the Board of Auditors, the Swedish Bar Association and the Swedish Security Police.