Question

The 5th Anti Money Laundering Directive introduces a number of changes on the 4th Directive. Outline the principal changes, providing reasons for their introduction.

Answer 1

The 5th Anti Money Laundering Directive introduces number of changes on the 4th directive. It is the series of amendments to the structure of the previous directive. Below are the principle changes made in the directive introduced.

1. Regulating Bitcoin- In the latest directive, virtual currencies like bitcoin will have the legal defination and these platform will also become regulated entities. The directive will also make a legal requirement for conducting any due diligence and reporting of suspicious transactions.

2. Prepaid cards- The directive will lower the requirement of customer verification as compared to 4th directive from euro 250 to 150 and 50 for some remote transactions. Also use of anonymous card outside is prohibited.

3. Registers of Beneficial Ownership- The directive allow the public access of the record as 4th directive only introduced the requirement for Registers of beneficial ownerships.

4. Enhanced due diligence- The directive have the requirement for enhanced due diligence while dealing with the transaction of high risk countries. It will also have the blacklist for such countries.

5. Increased reach- It will be extended to cover all the forms of tax advisory services,art dealer etc. Access will be given to the public on request of the information. Also increased protection to whistle blower will be given.