The Proceeds of Crime (Amendment No. 7) (Jersey) Law 2022 comes into full force on Friday 24 June 2022.
The new law is in response to The Financial Action Task Force (FATF) that requires jurisdictions to demonstrate that money laundering offences and activities are investigated, and all offenders are prosecuted and subject to effective, proportionate, and dissuasive sanctions.
The Government of Jersey decided that new statutory measures will greatly enhance the jurisdiction’s effectiveness of AML/CFT enforcement, and better meet the requirements of the FATF Methodology.
With this in mind, under Article 35A, the Amendment has added a new offence of “failure to prevent money laundering”.
As a direct result, if a customer of a Jersey financial services business (FSB) is found to have been “engaged in money laundering”, then the business can now also be found guilty of an offence.
Amendment No. 7 has shifted the evidentiary burden to Jersey FSBs
Before the Amendment, failure to comply with the requirements of the Money Laundering (Jersey) Order 2008 was an offence under Article 37 of POCL, but was difficult for prosecutors to prove to a criminal standard.
The new failure-to-prevent offence means that once the offence of money laundering or financing terrorism has been established, to the criminal standard (beyond reasonable doubt), then it is up to the FSB to demonstrate to the civil standard (the balance of probabilities) that it took adequate or reasonable steps to prevent the substantive offence.
In short, under Amendment No. 7, once money laundering by a customer has been established, the burden of proof lies with the FSB to prove that it had in place sufficient policies, procedures, systems, and controls to monitor ongoing customer activities.
A straightforward solution is available to all Jersey FSBs
Jersey FSBs will be relieved to know that the proposed amendment provides a “reasonable steps” defence that can be tailored to its business and risk requirements.
What exactly constitutes “reasonable steps” is subjective and much will depend on the size and risk profile of the FSB in question.
But the new legislation stipulates that a business will not face prosecution if it can prove that it “adequately maintained and applied prevention procedures in relation to the activities”.
And proving that the business has adopted best practice to fight financial crime and has implemented adequate prevention procedures can be easily demonstrated.
Through its award-winning onboarding, screening and in-life monitoring technology, Jersey FSBs can screen against sanctions, politically exposed persons (PEPs), watch lists, and monitor adverse media in real time.
By implementing RiskScreen’s flexible, scalable, and fully auditable AML & KYC solutions, it not only provides unrivalled peace of mind, but actively demonstrates compliance with the new law.
For a demonstration of how RiskScreen can help protect your organisation contact us today.