Anti money laundering in Italy - 2014 Report - draft (March, 21st 2015)
“Aml in Italy – 2014 Report” is a synthetic overview of the main news and regulatory updates in the Italian anti-money laundering landscape for the 2014 year and the first quarter of 2015.
The report is published in English and Italian to facilitate its dissemination.
This is a first draft used to discuss and share the content on line to prepare the final version which will be published on April 2015.
Chapter 2 - The Italian system of money laundering preventing and fighting
Paragraph 2.1.1 Laws, acts
Legislative Decree n. 231 of the 21st of November 2007
Based on the Third European AML Directive, Legislative Decree n.231 dated November, 21st 2007 dictates the anti-money laundering regulatory framework for the Italian financial system.
Legislative Decree 231/2007 establishes the duties that intermediaries must to carry out in order to aid authorities prevent and fight laundering of dirty money and international terrorist financing.
The fundamental obligations are:
- adequate monitoring of clients and of any transaction partner (so-called customer due diligence)
- risk-based approach, according to which customer due diligence obligations are divided into different levels of due diligence proportionate to the customer’s risk profile
- filing of reports and operations, as well as filing of any related documentation that may be of assistance
- reporting all suspicious transactions.
Legislative Decree n.231/07 assigns to the Bank of Italy the role of supervisory authority, in partnership with the Ministry of Economics and Finance which has to provide interpretative guidelines and to negotiate on this subject within the European and International community.
“Measures regarding the execution of organizational, procedural and internal auditing for the prevention of laundering” of March 10th 2011
On March 10th 2011 Bank of Italy issued “Measures regarding the execution of organizational, procedural and internal auditing for the prevention of laundering and terrorist financing through the utilization of intermediaries or other subjects, as per section 7, para 2 of the legislative decree dated 21st November 2007, n.231.” (1)
The “Measures” require financial intermediaries to:
- introduce specific organizational units for the monitoring and mitigation of money laundering/terrorist financing risk
- dedicate specialized resources,
- have adequate procedures and organizational functions
CDD - Customer Due Diligence of April 11th 2013
On January 1, 2014 the regulation on customer due diligence (2) in the field of anti-money laundering was enforced.
This regulation updated the Legislative Decree of November 21, 2007, no. 231 (the Italian anti money laundering Law) and obliges financial institutions to evaluate clients, relationships and transactions before accepting them in order to determine the level of money laundering and terrorism financing risk involved.
The new discipline requires different types of CDD, based on the risk profile of the client.
The obligations consists of:
- client identification; eventually identifying the “beneficial owner” too;
- obtain information regarding the scope and nature of the ongoing relation;
- continuous monitoring of the relationship.
As required by the Third EU AML Directive, financial intermediaries are obliged to carry out enhanced CDD if the client:
- is not physically present during the openness of the relationship
- has a high risk profile
- is a politically exposed person – PEP.
A “simplified” CDD can be carried out if the client turns out to be a credit or financial institution that comes under the Directive.
Instructions on “Archivio unico informatico – AUI” (Central Information Archive) of April 11th 2013 (3)
The “Instructions” were published by the Bank of Italy on April 11 2013 and enforced on January, 1st 2014.
They require that intermediaries register operations and the relationship that they have with their customers through the “Archivio unico informatico – AUI” which allows the reconstruction of the path of each client using a common standard.
- Provvedimento recante disposizioni attuative in materia di adeguata verifica della clientela ai sensi dell'art. 7, comma 2, del Decreto Legislativo 21 novembre 2007, n. 231 http://www.bancaditalia.it/compiti/vigilanza/normativa/archivio-norme/di... 11 aprile 2013
- Provvedimento recante disposizioni attuative per la tenuta dell'archivio unico informatico e modalità semplificate di registrazionedi cui all'art. 37, commi 7 e 8, del Decreto Legislativo 21 novembre 2007, n. 231 (in vigore dal 1° gennaio 2014) https://www.bancaditalia.it/compiti/vigilanza/normativa/archivio-norme/d... 11 aprile 2013