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  • Compliance & Business Integrity
  • March 22, 2019

The Financial Supervision Office (BFT) and the Tax Authorities/Supervision Office Money Laundering and Terrorist (Prevention) Act (BT Wwft) have announced they will, by way of exception, not enforce against possible violations of the objective indicator regarding high-risk third countries. Provided the transaction does not also qualify as unusual based on the subjective indicator.

In our previous blog we already noted that the legislator has recently taken the first step to remove the objective indicator regarding high-risk third countries from the Implementing Decree Wwft 2018. Following on from this BFT and BT Wwft have announced they will apply a lenient enforcement policy with regard to this objective indicator until the amendment of the Implementing Decree 2018 has been realized (in Dutch).

This means BFT and BT Wwft shall not take enforcement measures against institutions subject to the Wwft in case of possible violations of the objective indicator regarding high-risk third countries (i.e. when they have not reported an unusual transaction). But only insofar as the transaction does not also qualify as unusual based on the subjective indicator. The list of high-risk third countries does remain relevant for the assessment based on the subjective indicator ('a transaction whereby the institution has reason to assume it may relate to money laundering or terrorism financing').

It is questionable to what extent this leniency truly helps out institutions. After all, it is easier to just report a transaction that qualifies as unusual based on this objective indicator, than to have to assess whether the transaction also qualifies as unusual based on the subjective indicator. Especially since the objective indicator is formally still applicable and not (yet) all competent authorities have stated they will apply this reasonable approach (e.g. the Dutch Authority for the Financial Markets (AFM), the Dutch Central Bank (DNB), and the Public Prosecution (OM)).

If you have any questions about the Wwft, do not hesitate to contact us.

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