The financial sector stands united against money laundering and terrorist financing. Sweden, Denmark and Norway are members of the Financial Action Task Force (FATF), for example.
Member countries undertake to comply with international standards on measures to combat money laundering, terrorist financing and the proliferation of weapons of mass destruction. Standards which the European Union has also incorporated in its 4th AML Directive, which came into force in summer 2017. The changes took effect in Norway on 15 October 2018.
“The financial sector is a global industry and is governed by EU directives and regulations, as well as national laws and regulations, so it is important to have common standards across international borders. The objectives of the FATF are to set standards and promote the effective implementation of legislation and operational measures for combating money laundering and terrorist financing,” says Camilla Kingdon, Business Unit Conformance Officer at EnterCard.
Customer due diligence an important part of the work
It is important for EnterCard to know its customers in order to establish the customers’ identity and the purpose of the customer relationship. This helps to prevent customers exploiting EnterCard for the purposes of money laundering and terrorist financing.
All banks and financial institutions must identify whether the customer is a politically exposed person (PEP) – in other words, a person who is or has been entrusted with a prominent public function in a country or in an international organisation.
“If the customer is a PEP, this means that the individual in question, their family members and known employees run a greater risk of being the subject of bribery and corruption, which can lead to money laundering through the financial system. However, the fact that a customer is a PEP does not mean that we cannot accept them as our customer,” says Camilla Kingdon.