No Anonymous Accounts
Anonymous accounts or the provision of anonymous passbooks by credit or financial institutions are prohibited. Financial institutions may not retain anonymous accounts or passbooks that came into existence before the provision came into force. It is an offence to fail to comply.
A credit institution may not enter into a correspondent banking relationship with another credit institution in a place other than the EU unless prior to commencing the relationship,
- it gathers sufficient information about the other institution to understand the nature of its business,
- it is satisfied on reasonable grounds, based on publicly available information, that the reputation of the institution and the quality of supervision and monitoring are sound,
- it is satisfied on reasonable grounds, having assessed the anti-money laundering and anti-terrorist financial controls that apply, that those controls are sound,
- that it has ensured that approval is obtained from senior management of the credit institution,
- has documented the responsibilities of each institution in applying anti-money laundering and anti-terrorist financing controls to customers and
In the case of a proposal that customers of the respondent shall have direct access to a payable-through account held with the credit institution in the name of the respondent institution, it is to be satisfied on reasonable grounds that it has
- identified and verified the identity of those customers, and
- is able to provide to the credit institution, upon request, documents or information used by the credit institution to identify if the customers applied equivalent measures to those above.
Contravention is an offence subject to the same penalties as above
An exempted customer for the following purpose is a credit institution carrying on business in the State or in another money laundering controlling state, a listed company, or a public body either under domestic or EU law.
The above measures are not required if having taken such measures as are necessary to establish that the customer is, in fact, an exempted customer or exempted type of product, it is satisfied that the customer or product is an exempted customer or product.
An exempted product is
- A life assurance policy of not more than €1000 or a single premium of not more than €2,500,
- a policy in respect of a pension scheme, being a policy that does not have a surrender value and may not be used as collateral,
- a pension, superannuation or similar scheme,
An exempted product includes electronic money in a case where
- the electronic device concerned that cannot be recharged,
- the monetary value that may be stored electronically does not exceed €250 or if it cannot be used outside of the State, €500, or
- where the electronic device can be recharged, the total monetary value of all amounts by which the device may be charged or recharged in any calendar year, is less than €2,500, and none or less than €1,000 of the electronic money may be redeemed by the issuer in that year.
There is an exemption from carrying out certain customer due diligence measures in respect of electronic money. Certain conditions must be fulfilled if the exemption is to be availed of, including that the monetary value that can be stored on the instrument must not exceed a certain amount.
The issuer of the instrument must carry out sufficient monitoring of the business relationship or transactions concerned to enable the detection of unusual or suspicious transactions. The exemption cannot be applied if the customer is established or resident in a high-risk third country or if the customer or beneficial owner is a politically exposed person.
A designated business to examine the background and purpose of all complex and unusual transactions and to increase the degree and nature of monitoring of a business relationship in order to determine whether the transactions appear suspicious. Failure to comply with legislation is an offence.
A credit institution is not obliged to apply the measures in relation to solicitor’s client account or certain other parties who are supervised or monitored for compliance in accordance with the Money Laundering legislation. There are exceptions to the exemption.
A credit institution may apply the exemption in relation to beneficial ownership of money in a trust, only if it is satisfied that the information on the identity of the beneficial owners held is available, on request. The exemptions are not available in certain specified circumstances.
Branch & International
Branches or subsidiaries, outside an EU State, of a credit or financial institution that is a designated business, must comply with requirements equivalent to those set out in Chapters II and IV of the Third Money Laundering Directive. If this is not possible, the designated business must inform the regulator and apply measures to address the risk of money laundering or terrorist financing.
A credit or financial institution that is a designated business and incorporated in the State communicates policies and procedures adopted to branches or subsidiaries outside an EU State. There are penalties for failing to comply.
A regulator must take certain steps when it has been notified that a third country’s laws do not allow the implementation of group-wide policies and procedures. The regulator must exercise additional supervisory actions, which may include directing the group not to establish a business relationship. An appeal may be brought against the notice to the High Court. Failure to comply with a direction is an offence.
Entering, by a credit institution, into a banking relationship with a shell bank is prohibited. Any pre-existing arrangements must cease to continue on the commencement of the provision. A credit institution must refrain from engaging in or continuing a correspondent banking relationship with a bank where the institution is aware that the bank permits its accounts to be used by a shell bank.
A credit institution must adopt measures to ensure that it does not enter into or continue a correspondent banking relationship with a bank engaged in such activities. A breach is an offence under the provision.
A ‘shell bank’ means a credit institution or financial institution (or a body corporate that is engaged in activities equivalent to those of a credit institution or financial institution) that—
- does not have a physical presence involving meaningful decision-making and management in the jurisdiction in which it is incorporated,
- is not authorised to operate, and is not subject to supervision, as a credit institution, or as a financial institution, (or equivalent) in the jurisdiction in which it is incorporated, and
- is not affiliated with another body corporate that—
- has a physical presence, involving meaningful decision-making and management, in the jurisdiction in which it is incorporated, and
- is authorised to operate, and is subject to supervision, as a credit institution, a financial institution or an insurance undertaking, in the jurisdiction in which it is incorporated.