EG 19.15 1The conduct of investigations under the Money Laundering Regulations

EG 19.15.1

1The FCA will notify the subject of the investigation that it has appointed officers to carry out an investigation under the Money Laundering Regulations and the reasons for the appointment, unless notification is likely to prejudice the investigation or otherwise result in it being frustrated. The FCA expects to carry out a scoping visit early on in the enforcement process in most cases. The FCA's policy in civil investigations is to use powers to compel information in the same way as it would in the course of an investigation under the Act.

EG 19.15.2

1When the FCA proposes or decides to impose a penalty under the Money Laundering Regulations , it must give the person on whom the penalty is to be imposed a notice. These notices are akin to warning notices and decision notices given under the Act, although Part XXVI (Notices) of the Act does not apply to notices given under the Regulations.

EG 19.15.3

1The RDC is the FCA's decision maker for contested cases in which the FCA decides to impose a penalty under the Money Laundering Regulations. This builds a layer of separation into the process to help ensure not only that decisions are fair but that they are seen to be fair. The RDC will make its decisions following the procedure set out in DEPP 3.2 or, where appropriate, DEPP 3.3. Where the FCA imposes a penalty on a person under the Money Laundering Regulations, that person may appeal the decision to the Tribunal.

EG 19.15.4

1Although the Money Laundering Regulations do not require it, the FCA will involve third parties and provide access to Authority material when it gives notices under the Regulations, in a manner consistent with the provisions of sections 393 and 394 of the Act. However, there is no formal mechanism under the Money Laundering Regulations for third parties to make representations in respect of proposed money laundering actions. If a third party asks to make representations, it will be a matter for the FCA's decision makers to decide whether this is appropriate and, if so, how best to ensure that these representations are taken into consideration. In general it is expected that decision makers would agree to consider any representations made. Third parties may not refer cases to the Tribunal as the Money Laundering Regulations give the Tribunal no power to hear such referrals.

EG 19.15.5

1When imposing or determining the level of a financial penalty under the Regulations, the FCA's policy includes having regard, where relevant, to relevant factors in DEPP 6.2.1G and DEPP 6.5 to DEPP 6.5D. The FCA may not impose a penalty where there are reasonable grounds for it to be satisfied that the subject of the proposed action took all reasonable steps and exercised all due diligence to ensure that the relevant requirement of the Money Laundering Regulations would be met. In deciding whether a person has failed to comply with a requirement of the Money Laundering Regulations, the FCA must consider whether he followed any relevant guidance which was issued by a supervisory authority or other appropriate body; approved by the Treasury; and published in a manner approved by the Treasury. The Joint Money Laundering Steering Group Guidance satisfies this requirement.

EG 19.15.6

1As with cases under the Act, the FCA may settle or mediate appropriate cases involving civil breaches of the Money Laundering Regulations to assist it to exercise its functions under the Regulations in the most efficient and economic way. The settlement discount scheme set out in DEPP 6.7 applies to penalties imposed under the Money Laundering Regulations.

EG 19.15.7

1The FCA will apply the approach to publicity that it has outlined in EG 6. However, as the Money Laundering Regulations do not require the FCA to issue final notices, the FCA will publish such information about the matter to which the decision notice relates as it considers appropriate. This will generally involve publishing the decision notice on the FCA's website, with or without an accompanying press release, and updating the Public Register.