The Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2021 (the 2021 Act) came into effect on 23rd April 2021, transposing the 5th Anti-Money Laundering Directive (5AMLD) into Irish law. 5AMLD imposes enhanced background checks on Designated Persons when taking on new clients.
From 23rd April 2021 onwards, Section 35 of the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 (as amended) provides that all Designated Persons must check the Register of Beneficial Ownership to ensure the information contained on that register matches the information provided by the client, with respect to the beneficial owners of a corporate body before a establishing a business relationship. In the case where a Designated Person discovers that a corporate body has provided information that clashes with the information contained on the Register of Beneficial Ownership, the Designated Person is now obliged under law to report this discrepancy to the Registrar of Beneficial Ownership. In the event of a Designated Person finding that a corporate body has not made its filing with the Register of Beneficial Ownership within 5 months of incorporation, the Designated Person is also obliged in this instance to report this omission to the Registrar of Beneficial Ownership. The transposition of 5AMLD also expands the definition of a Designated Person.
Section 25 of the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 (as amended by the 2021 Act) expands the definition of a Designated Person for the purposes of Anti-Money Laundering and the countering of Terrorist Financing in Ireland to the following:
A spokesperson for the Register of Beneficial Ownership in Ireland recently stated that the RBO has commenced a compliance campaign to encourage further compliance with the requirement to submit beneficial ownership details with RBO and will be sending out around 5,000 emails per week to 40,000 non-compliant companies.
There is no doubt that this enhancement to our Anti-Money Laundering framework gives Designated Persons enhanced reporting obligations, however it is a positive measure to ensure a more transparent financial system in Ireland.