Enhanced Definitions
The Directive provides further definitions of offences that are, or should be, criminalised, including aggravating factors. Predicate offences have been elaborated and cyber-crime explicitly identified, as well as the need to examine the heightened risks of mobilisation through technology and evolving financial products that impact traceability, such as virtual assets.
Extending jurisdictions across the Union
The Directive considers offences committed within Member States and also extends the jurisdictional scope of Member States where the offence is committed across the Union
Widening net of accountability
The Directive also defines the liability of professionals or ‘enablers’ and the related sanctions that should be considered, including recommendations of up to 4 years imprisonment for natural persons. These definitions further ensure that certain types of money laundering activity are punishable when committed by the perpetrator of the criminal activity that generated the property (self-laundering), not just the mere possession or use of the property, but also the transfer, conversion, concealment or disguise of property, which results in further damage than that already caused by the criminal activity.
Financial institutions, and professional service providers, must ensure that they are able to identify trends and patterns that give rise to money laundering and are not exposed themselves to the risks of weak systems and controls to combat money laundering.
The 6AMLD demonstrates the move towards tougher sanctions and broadening the net of accountability with tougher criminal sanctions.
High Level Summary of 6AMLD
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Article 1
Subject Matter & Scope
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Sets out minimum rules concerning the definition of criminal offences and sanctions in the area of money laundering.
This Directive does not apply to money laundering as regards to property derived from criminal offences affecting the Union’s financial interests under EU2017/1371.
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Article 2
Definitions
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Further definitions set forth:
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Criminal Activity
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Defined as any kind of criminal involvement in the commission of any offence punishable for a period of 6 months to 1 year or more
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Offences considered to be criminal activity
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a) Participation in an organised criminal group and racketeering
b) Terrorism
c) Human trafficking & Migrant smuggling
d) Sexual exploitation
e) Illicit trafficking in narcotic drugs and psychotropic substances
f) Illicit arms trafficking
g) Illicit trafficking in stolen goods and other goods
h) Corruption
i) Fraud
j) Counterfeiting of currency
k) Counterfeiting and piracy of products
l) Environmental crime
m) Murder, grievous bodily injury
n) Kidnapping, illegal restraint and hostage-taking
o) Robbery or theft
p) Smuggling
q) Tax crimes relating to direct and indirect taxes as laid down in national law
r) Extortion
s) Forgery
t) Piracy
u) Insider dealing and market manipulation
v) Cybercrime
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Article 3
Money Laundering Offences and Article 4 Aiding and Abetting
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Following conduct, when committed intentionally, is to be punishable as a criminal offence regardless of whether the offender suspected or ought to have known that the property was derived from criminal activity
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In respect of such conduct, Member States must take the following measures:
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Article 4
Member States shall take necessary measures to ensure that aiding and abetting, inciting and attempting an offence in Article 3 is punishable as a criminal offence
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Conversion or transfer of property, knowing that such property is derived from criminal activity, for the purpose of concealing or disguising the illicit origin of the property or of assisting any person who is involved in the commission of such an activity to evade the legal consequences of that persons actions
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Prior or simultaneous conviction for the criminal activity from which the property was derived is not a prerequisite for a conviction for the offences
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Concealment or disguise of the true nature, source, location, disposition, movement, rights with respect to, or ownership of, property, knowing that such property is derived from criminal activity
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A conviction for the offences referred to is possible where it is established that the property was derived from a criminal activity, including the identity of the perpetrator
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Acquisition, possession or use of property, knowing at the time of receipt, that such property was derived from criminal activity
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The offences extend to property derived from conduct that occurred on the territory of another Member State or 3rd country where that conduct would constitute a criminal activity had it occurred domestically
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Article 5
Penalties for natural persons
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Member States shall take effective measures to ensure that offences are punishable by:
· Effective, proportionate and dissuasive criminal penalties;
· Maximum term of at least 4 years;
· Additional sanction or measures to apply
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Article 6
Aggravating Circumstances
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Member States shall take necessary measures to ensure that the following are regarded as aggravating circumstances in respect of the offences in Article 3::
· Offence committed within the framework of a criminal organisation (within the meaning of Framework Decision 2008/841/JHA; or
· The offender is an obliged entity within the meaning of Article 2 of EU 2015/849 and has committed the offence in the performance of their professional activities
· Member States may also consider the Laundered property is of considerable value or derives from one of the offences in Article 2 (a)-(e) and (h) as aggravating circumstances
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Article 7 & 8 Liability and Sanction of legal persons.
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Article 7- Liability of legal persons
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Article 8 - Sanctions of legal persons
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Member States shall take necessary measures to ensure legal persons can be held liable for any offence referred to in Article 3 and Article 4 committed for their benefit by any person, acting either individually or as part of an organ of the legal person and having a leading position within the legal person, based on any of the following:
a) A power of representation of the legal person
b) An authority to take decisions on behalf of the legal person; or
c) An authority to exercise control within the legal person
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A legal person held liable pursuant to Article 7, is punishable by effective, proportionate and dissuasive sanctions including criminal and non-criminal fines and other sanctions such as:
a) Exclusion from entitlement to public benefits or aid;
b) Temporary or permanent exclusions from access to public funding, including tender procedures, grants and concessions
c) Temporary or permanent disqualification from the practice of commercial activities;
d) Placing under judicial supervision;
e) A judicial winding up order;
f) Temporary or permanent closure of establishment which has been used for committing the offence
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Article 10
Jurisdiction
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Offence Committed within a Member State
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Member State Extends Jurisdiction when Offence is committed outside of its territory
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When offence occurs across a number of Member States, to determine the centralisation of proceedings into a single Member State
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Member State shall take necessary steps to establish its jurisdiction over the offences in Article 3 and 4 where:
a) Offence is committed in whole or part on its territory
b) Offender is one of its nationals
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Member State must inform the Commission where it extends its jurisdiction to offences in Article 3 and 4 which have been committed outside its territory where:
a) The offender is habitually resident on its territory
b) The offence is committed for the benefit of a legal person established on its territory
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The following will be considered:
a) The territory of the Member State on which the offence was committed
b) Nationality or residency of the offender
c) Country of origin of the victim or victims
d) Territory on which the offender was found
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