OUR SERVICES
ANTI-MONEY LAUNDERING AND COUNTER TERRORISM FINANCING (AML/CTF)
How to comply with constantly evolving anti-money laundering obligations following a risk-based approach?
The fight against money laundering and counter terrorism financing is governed by two approaches: prevention and enforcement.
The preventive approach consists of regulatory law putting the responsibility on designated actors of the private sector (obliged entities) to prevent the use by customers of their structures and activities to launder money or finance terrorism. The preventive law imposes positive obligations on obliged entities to help prevent, detect, and report money laundering suspicions. The mere negligence to implement an adequate, proportionate and risk-based internal compliance framework makes obliged entities liable to hefty sanctions and reputational damages as established in the AML/CTF legislation.
The enforcement approach consists of incriminating the commission of and participation to money laundering and terrorism financing by criminal law, which is punishable with severe penalties. Criminal conviction traditionally requires criminal intent. Yet, criminal authorities tend to consider that structural weaknesses in the internal compliance framework may demonstrate the criminal intent of an institution to participate in money laundering: i.e. the willful implementation of insufficient controls allowing the institution and its personnel to turn a blind eye on unlawful activities.
At Ethics & Compliance, thanks to our experience as white-collar crime lawyer and senior expert in compliance, we provide assistance on both the preventive and enforcement aspects of the fight against money laundering and terrorism financing to protect our partners.
- conducting overall risk assessments and gap analyses and preparing remediation plans
- establishing group and local AML/CFT risk-based policies and procedures, inter alia for internal organization, customer acceptance, KYC and KYT due diligence, atypical events analysis and suspicions reporting, record keeping, etc.
- setting up the internal organizational framework, taking the group dimension and outsourcing opportunities into consideration, including relevant lines of defense
- conducting KYC customer due diligence, including designing and conducting individual risk assessments, assessing and reviewing customer profiles (including on funds repatriation and derisking management)
- conducting risk-based ongoing KYT customer due diligence, including defining risk scenarios and alerts, monitoring transactions and analyzing atypical operations, funds or activities
- drafting suspicious activity reports and reporting suspicions to the FIU
- setting up the tone at the top, giving trainings and raising awareness on AML/CTF
- advising on technological tools and processes to improve due diligence quality and effectiveness
- preparing yearly AML/CTF activity reports and completing questionnaires from regulatory authorities
FINANCIAL AND ECONOMIC SANCTIONS AND EXPORT CONTROLS
How to keep up and comply with increasingly expanding financial and economic sanctions and export controls?
- conducting sanctions risk assessments and gap analyses and preparing remediation plans
- establishing group and local sanctions policies and procedures, inter alia for internal organization, business partners screening, true hits reporting, record keeping, etc.
- setting up the internal organizational framework, taking the group dimension and outsourcing opportunities into consideration
- screening business partners, contracts and transactions against economic and financial sanctions
- monitoring business partners and transactions, analyzing and reporting hits to the authorities
- setting up the tone at the top, giving trainings and raising awareness on sanctions compliance
- advising on technological tools and processes to improve due diligence quality and effectiveness
We also take on outsourced functions, such as of Sanctions Officer, at our partners premises.
ANTI-BRIBERY AND CORRUPTION (ABC)
How to protect your business against bribery and corruption risks?
Anti-bribery and corruption (ABC) compliance refers to the implementation of an internal compliance framework to prevent, detect and report bribery, corruption and similar misconducts to the authorities.
The United States of America, the United Kingdom and France have all three adopted stringent anti-bribery and corruption legislation with extraterritorial reach and subject to hefty sanctions requiring designated businesses to set up an appropriate ABC internal framework.
Also, most responsible investors do conduct due diligence on the ABC framework of businesses today when considering investments.
Last but not least, most responsible investors do conduct due diligence on the ABC framework of businesses today when considering investments.
It is therefore paramount for all businesses to implement a sound and risk-based ABC framework to prevent, detect and report such conducts and protect their interests.
- conducting bribery and corruption risk assessments and gap analyses and preparing remediation plans
- establishing group and local ABC policies and procedures, inter alia for internal organization, business partners screening, gifts and hospitality, expenses accounting, record keeping, etc.
- setting up the internal organizational framework, taking the group dimension and outsourcing opportunities into consideration
- screening and monitoring business partners, contracts and transactions against bribery and corruption risks
- setting up the tone at the top, giving trainings and raising awareness on ABC
- advising on technological tools and processes to improve due diligence quality and effectiveness
- complying with ISO 37001 on anti-bribery management systems
We also take on outsourced functions, such as of ABC Officer, at our partners premises.
WHISTLEBLOWING
How to comply with your obligations to implement internal whistleblowing channels and procedures and to protect whistleblowers?
- establishing group and local whistleblowing policies and procedures
- implementing appropriate and secure internal reporting channels
- appointing relevant Whistleblowing Officers, including case recipients, managers and investigators
- ensuring confidentiality and protecting whistleblowers against retaliation
- advising on tools and processes to improve case management quality
- setting up the tone at the top, giving trainings and raising awareness on whistleblowing
- complying with ISO 37002 on whistlenlowing management systems
We also take on outsourced functions, such as of case recipient, manager and/or investigator on behalf of our partners.
DE-RISKING MANAGEMENT
How can higher risk customers secure or maintain a business relationship with a financial institution?
De-risking refers to the decision taken by a financial institution either a priori to refuse entering a business relationship with a potential customer or to terminate an existing relationship on the grounds that this customer belongs to a category which the financial institution considers too risky from an AML/CTF perspective.
Over the past years, the de-risking phenomenon has grown exponentially, leaving numerous customers locked out of the traditional banking system.
Conscious of these difficulties, Ethics & Compliance offers to act as a bridge between financial institutions and higher risk customers, by conducting an expert and neutral enhanced due diligence analysis on such customers in support of their application to enter or maintain a relationship with the financial institution.
The analysis conducted includes, but is not limited to, the identification of opportunities and obstacles to establishing or maintaining a business relationship, based on the requirements and regulatory standards set out in the EU 4th and 5th AML/CTF Directives and in applicable national law.
We also assist businesses, including companies, to secure basic banking services in this context.
UBOS IDENTIFICATION AND REPORTING
How to adequately identify and report ultimate beneficial owners?
The ultimate beneficial owners (UBOs) of a business partner are the natural persons who ultimately own or control the business partner and/or the natural persons on whose behalf a transaction is carried out or a business relationship is established.
The identification of the UBO of a business partner or a transaction is crucial as criminals tend to hide themselves behind complex non-transparent structures and behind strawmen to avoid being identified or being caught.
UBO legislations have therefore substantially developed in the past years to impose increasing obligations on UBOs, reporting entities and obliged entities respectively. Beyond anti-money laundering legislations, UBO identification has become a key component of anti-bribery and corruption and economic and financial sanctions laws and regulations.
At Ethics & Compliance, we therefore help both reporting entities (who must report their UBOs) and obliged entities (who must identify the UBOs of their business partners) to fully understand the concept of UBO and their obligations deriving from related legislations.
CRYPTO ASSETS FRAUD PREVENTION
How to prevent, detect and obstruct the fraudulent use of crypto assets?
Crypto assets, also referred to as cryptocurrencies, are virtual and digital assets secured by cryptography that can be used as a medium of exchange via the blockchain.
Crypto assets and their exchanges are decentralized in nature: they are traditionally neither issued nor backed by a government or a central bank, and their transactions are not monitored by financial institutions. Their expansion has led to the broader development of decentralized finance (DeFi).
As a result, crypto assets exchanges may benefit from a certain degree of anonymity and be exploited by criminals for unlawful purposes, including but not limited to money laundering, terrorism financing, tax fraud, bribery, market manipulation, embezzlement, scam initial coin offering, ponzi schemes, ransom schemes, traditional theft and other forms of cybercrime.
The regulation of crypto assets, providers of exchange services between crypto currencies and fiat currencies and custodian wallet providers is therefore a crucial issue and is expanding importantly with a view to offering more transparency and security to the use of crypto assets.
At Ethics & Compliance, we assist businesses and individuals in assessing the risks related to crypto assets, in implementing risk-based policies, procedures and/or controls to prevent the fraudulent use of such assets, and in conducting state-of-the art AML/CFT due diligence on crypto transactions including via the implementation of the travel rule.
MARKET ABUSE PREVENTION
How to protect your business from market abuse attempts?
Market abuse is a concept that encompasses unlawful behavior in the financial markets and includes three offences: unlawful disclosure of inside information, insider dealing and market manipulation.
As a rule, any person holding material non-public information (e.g. on a listed business) is required to treat this information with utmost confidentiality. They are prohibited from trading in related securities and from disclosing inside information to third parties such as family members or friends.
It is therefore paramount for listed businesses and identified business partners to prevent their personnel from engaging in any form of market abuse.
At Ethics & Compliance, we help businesses design and implement policies, procedures and controls, to prevent market abuse attempts and to comply with their preventive obligations as set out in the EU Market Abuse Directives and Regulations and deriving national legislations.