Companies have had “ample” time to prepare for the fight against money laundering, according to John Marsden, head of ID and fraud at Equifax.
The fourth EU Money Laundering Directive (MLD4) has now been implemented and is designed to strengthen the EU’s defences against money laundering and terrorist financing.
The directive must also ensure the EU framework is aligned with the Financial Action Task Force’s international anti-money laundering and counter-terrorist financing standards.
As money laundering continues to damage the UK economy, Equifax said it’s time to see if companies’ compliance processes are up to scratch or whether a flurry of fines from the Financial Conduct Authority (FCA) will be issued.
Marsden said: “The rise in high profile fines for failing to maintain money laundering defences proves that this issue is a key regulatory priority.
“Financial penalties for big players have pushed other industry giants to get their anti-money laundering procedures in shape.”
Big financial institutions are ready to have their money laundering processes assessed but Marsden said it may be a different story for smaller firms. This is because the FCA don’t usually tend to hone in on smaller businesses but this could change due to anti-money laundering being so high up on the political and economic agenda.
He said: “While a traditional approach would target the bigger banks, smaller financial institutions could be subject to a series of warning shots in the form of audits, investigations and sanctions, should the regulator suspect they are failing to comply with MLD4.”
Companies must ensure they stay up to date with regulation as the fifth EU Money Laundering Directive (MLD5) is set to launch next year.