As of August 2021, new regulations have come into force in the Money Laundering Act (AMLA). The law serves to track down profits from crime. There are numerous reporting, due diligence and documentation obligations to be observed that are intended to combat terrorist financing and the concealment of the origin of funds. While it was previously sufficient for the companies affected under Section 2 GwG to only enter themselves in the transparency register if they were not already recorded in other registers, such as commercial, association or cooperative registers, in future they will generally have to deposit their data there themselves. In addition, there is the obligation to update immediately in the event of changes.
By when do companies have to act?
The number of persons and companies affected by the GWG is very high. An exact and exhaustive list of those obliged by the GWG can be found in Section 2 (1) AMLA. All newly “affected persons” will be granted a grace period until 31 March 2022 or 31.12.2022 at the latest. Fines for a violation of the initial reporting obligation will be imposed from 31.03.2023 at the earliest. The option that the data can be collected by reliable third parties, such as financial administrators or lawyers, still exists.
Why should you take action early?
Increasing queries of the transparency register from companies and threats of fines are expected. Here you should be “clean” in good time. Even first-time violations of the registration obligation are already subject to severe fines by the Federal Office of Administration.
What penalties do companies face?
Section 56 AMLA contains an overview of the breaches of duty that can be punished with a fine. While the fine framework provides for a fine of up to 100,000 euros in many cases, fines of up to five million euros or 10 percent of the previous year’s turnover can be imposed for serious, repeated and systematic violations.
In addition, the supervisory authority publishes unappealable decisions on fines by name on its website (pillory function). In addition, fines can be imposed on the owner or managing director according to §§ 30 and 130 of the Administrative Offences Act (OWiG). Possible accusation: You did not take any preventive measures and did not monitor compliance with them, thus violating Section 130 (1) OWiG.
Conclusion and outlook
The aim of the changes is to improve the quality of entries in the Transparency Register in order to prepare it for a European register network. Furthermore, the transparency register is to become increasingly important in the customer identification process.
For the German economy, the innovations mean a considerable additional effort. In addition to the initial registration, which is mandatory for many companies, they will also have the obligation to check their information for up-to-dateness and adjust it if necessary. Until now, this obligation only applied to companies that were excluded from a notification fiction. The introduction of an electronic interface for the customer identification process is intended to make things easier only for those obliged to comply with money laundering law.
The networking of the European transparency registers is fundamentally positive. However, it can only be effective if the substantive provisions on the beneficial owner are also standardised throughout Europe. Comprehensive harmonisation of anti-money laundering regulations will therefore be crucial.
Image source: Pixabay, Photographer: Alexas_Fotos
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