the full picture, this week – 09 August 2019

by | Aug 9, 2019 | All Blog Posts, the full picture this week, Featured

Let us put you in the picture this week, as we round-up and react to the latest news from the financial crime compliance and technology sectors.

This week, we cover the Serious Fraud Office’s new guidance on how firms can effectively cooperate with prosecutors, but the views from the regulated sector are mixed.

Elsewhere, the US unleashes the full force of sanctions on Venezuela’s government, and State Farm reveals the keys to their successful digital transformation.

These issues, and more from around the globe, give us plenty to dive into for your Full Picture, This Week…

Click here to get The Full Picture, This Week sent to your inbox every Friday.

Australia’s regulatory changes examined as legislation puts restrictions on the use of cash under the spotlight’

the full picture, this week - 09 August 2019 | Australian dollars | encompass blogNew legislation that focuses on restrictions around the use of cash is on the radar of businesses in Australia, as they look to keep up with the latest regulatory obligations.

The draft legislation, released early this month, aims to prevent the use of cash in economic activities as a way of avoiding coming under fire from regulatory bodies

Samantha Carroll, Practice Director, Governance Compliance and Regulation at Ash St. Legal & Advisory, examines what this means for Anti-Money Laundering (AML) regulations in the country, as well as the impact on organisations affected.

a new approach to guidance from the Serious Fraud Office

the full picture, this week - 09 August 2019 | Serious Fraud Office | encompass blogOn Tuesday, the Serious Fraud Office (SFO) laid out steps a company can take if it wants to cooperate with prosecutors. They give no assurance, however, that even full cooperation will lead to any leniency in the event of charges.

The SFO said that even robust cooperation wouldn’t guarantee a particular outcome.
“It’s a lot of quid and not much quo,” said Matthew Getz, a lawyer at Boies Schiller Flexner LLP in London who represents companies before the SFO.

Of key concern is the issue of privilege, which protects certain communication between law firms and their clients. The guidance, however, reiterated the SFO’s stance that companies seeking cooperation credit should be prepared to waive legal privilege on notes documenting witness interviews. The Wall Street Journal has more here [subscription required].

Law firms remain unsure of the implications of the guidance, according to an article in The Law Society Gazette.

the Encompass view

The level of impact of voluntary disclosure and subsequent cooperation has been evidenced recently, when the UK Government’s Office of Financial Sanctions Implementation (OFSI) imposed its first monetary penalty, under new powers afforded to it under the Policing and Crime Act 2017, against a small independent UK bank.

Here, the eventual penalty amount represented a 50 per cent reduction of the baseline £10,000 penalty initially assessed by OFSI as a result of the bank’s voluntary disclosure of the breach and subsequent cooperation.

The ability to cooperate effectively rests heavily on having all relevant information relating to an investigation in a regulator-friendly format, especially when it comes to demonstrating compliance with AML and KYC regulation. Encompass uses Intelligent Process Automation (IPA) to simplify KYC discovery, dynamically building comprehensive and accurate AML packs, along with a full audit trail, as searches are carried out and decisions are made. Our customers can feel confident that, should the need arise, they can present the results of their KYC efforts in a way at assists investigators and demonstrates compliance.

the Encompass view

The level of impact of voluntary disclosure and subsequent cooperation has been evidenced recently, when the UK Government’s Office of Financial Sanctions Implementation (OFSI) imposed its first monetary penalty, under new powers afforded to it under the Policing and Crime Act 2017, against a small independent UK bank.

Here, the eventual penalty amount represented a 50 per cent reduction of the baseline £10,000 penalty initially assessed by OFSI as a result of the bank’s voluntary disclosure of the breach and subsequent cooperation.

The ability to cooperate effectively rests heavily on having all relevant information relating to an investigation in a regulator-friendly format, especially when it comes to demonstrating compliance with AML and KYC regulation. Encompass uses Intelligent Process Automation (IPA) to simplify KYC discovery, dynamically building comprehensive and accurate AML packs, along with a full audit trail, as searches are carried out and decisions are made. Our customers can feel confident that, should the need arise, they can present the results of their KYC efforts in a way at assists investigators and demonstrates compliance.

Wayne Johnson | CEO & Co-founder, Encompass

Venezuela: new sweeping US sanctions target the government

The BBC reports on the President Donald Trump and his sweeping sanctions on the Venezuelan government.

The executive order states that “all property and interests in property of the government of Venezuela that are in the United States… are blocked and may not be transferred, paid, exported, withdrawn, or otherwise dealt in”.

The order also bars transactions with Venezuelan authorities whose assets are blocked, stating that “the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any person whose property and interests in property are blocked pursuant to this order”.

“The receipt of any contribution or provision of funds, goods, or services from any such person,” is also banned.

The Associated Press explores the scope and potential impact of President Donald Trump’s executive order in more detail.

State Farm’s digital transformation tips

At 100 years old, the US’s number one insurer, State Farm, took on a significant digital transformation to continue to be relevant in the digital age.

Amongst the nuggets are the need to recognise and understand the current situation, and to accept that the way you were organised in the past will not work in the future.

Read the full article on Forbes here.

news in brief

As Swift is preparing to open its KYC Registry to corporates in the last quarter of the year, the company has entered discussions with regional know your customer utilities about connecting their solutions.

Alison Thewliss, the Scottish National Party’s Treasury Spokesperson has urged the UK Government to take urgent action to crack down on loopholes that can enable money laundering through the UK.

Thailand’s anti-money laundering regulator is planning to amend the country’s laws to include cryptocurrency.

An article in Wired argues that automation and job displacement will be one of the most significant challenges for the global economy of the coming decades.

US assistant secretary for terrorism financing and financial crime Marshall Billingslea said in a recent interview that Malta needs to send a “very strong signal” that corruption and financial crime will not be tolerated.

The Financial Conduct Authority (FCA) is set to delay enforcement of the Strong Customer Authentication (SCA) payment security rules by more than 18 months, on the recommendation of UK Finance.

the latest from Encompass

Learn how leading Edinburgh-based law firm, Anderson Strathern, engaged Encompass to drive efficiency in client onboarding and due diligence.

The world of Know Your Customer (KYC), compliance and financial crime never sleeps, and if your challenges are keeping you up at night let us help. Encompass intelligently automates information and news discovery for KYC requirements for onboarding ongoing monitoring.

Driven by your internal policies, our platform automatically constructs corporate ownership structures, discovers beneficial owners, and in minutes screens all relevant entities and persons for regulatory, reputational and financial risk.