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Last Updated: Wednesday, 31 March, 2004, 23:07 GMT 00:07 UK
Firms lag on money laundering fix
Cash
Firms must report suspiciously large cash purchases
Many UK businesses are not ready for new rules against money laundering, despite the threat of jail for bosses who do not comply, a survey says.

The rules come into force on 1 April, and mean that a new range of firms have to report money laundering suspicions.

Research by BT suggests that financial institutions have generally taken steps to identify customers properly.

But it warns that many of the sectors newly included - such as jewellers and auctioneers - are lagging behind.

Reporting

For years, finance firms have had to report "suspicious transactions" to the National Criminal Intelligence Service (NCIS).

The new regulations are designed to take account of the fact that criminals are increasingly turning to avenues other than banks and financial institutions to clean up the proceeds of crime.

Luxury goods from jewellery and gold to cars and antiques are popular choices, as is property.

Because of this, the new rules mean "high-value dealers" have to register with Customs and Excise, particularly if large cash payments are likely to take place.

Generally, dealers must make a "suspicious activity report" to NCIS on any cash transaction of more than 15,000 euros (about 10,000) - although smaller transactions must also be reported if they arouse any suspicions.

A failure to report could land directors with heavy fines and up to two years in jail.

Preparedness

The new regulations were published months ago, but experts say the sweeping inclusion of so many sectors has caused some confusion.

BT tested preparedness by polling 150 chief executives from a sample of top stockbrokers, financial advisers, property advisers, car dealers and luxury goods companies such as auctioneers.

More than three out of five stockbrokers were ready for the new regulations, the survey found.

But only 23% of luxury goods companies had made the right preparations - and only 3% of car dealers.


SEE ALSO:
New clampdown on money laundering
01 Mar 04  |  Business
Watchdog fines Bank of Scotland
15 Jan 04  |  Scotland
UK pledges dirty money shake-up
01 Jul 03  |  Business
Law targets criminal earnings
24 Mar 03  |  Scotland


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