Jersey Updated guidance –FIU response to Suspicious Activity Reports (“SARs”)

Please see below updated information regarding changes to the FIU responses to Article 32(4) requests to the unit, this information is also now on the JFCU website https://jersey.police.uk/media/591275/Updated-Guidance-FIU-response-to-SARs.pdf

Following a recent internal review of its SARs processes the FIU is clarifying how it will respond to submissions of SARs/Continuation Reports.

The purpose of the following is to improve the provision of information to the FIU in relation to requests for consent, with the objective being to furnish the FIU with sufficient information and details so that it can appropriately and expeditiously consider requests.

SARs without specific consent to an act being sought under Article 32(4) of the Proceeds of Crime (Jersey) Law 1999, as amended (POCJL 1999).

Where no specific consent for an act is being sought under Article 32(4) of the POCJL 1999, the FIU will usually only issue an acknowledgement in response to a SAR.

SARs seeking consent for an act pursuant to Article 32(4) of the POCJL 1999

The FIU acknowledges there may be instances when consent is sought from the FIU for an act on the submission of a SAR or a Continuation Report (prescribed for in Article 32(4) of the POCJL 1999). Such consent requests may be for a specific transaction (for example a distribution) or more generally ‘to operate/maintain’.

On submission of your SAR, you will appreciate this is often the first instance the FIU has been informed of your suspicion of money laundering; as such the FIU may not have sufficient information to provide the consent sought. A consent to “operate/maintain” has become a generalised term widely used by industry. However there may be a distinct lack of clarity as regards what ‘operate/maintain’ actually entails in respect of your ongoing relationship with the client or customer you suspect of money laundering, and consequently what impact a grant of consent will have.

In order to assist the FIU in expediting its decision making process; with regard to your request for consent to carry out an act (which if carried out without such consent would potentially amount to the commission of an offence under Article 30 or 31 of the POCJL 1999), the FIU requires it be provided with as much information as possible to enable the FIU to understand the ‘act’ you are seeking consent for. This requirement applies to both consent requests for specific acts and general consent requests to “operate/maintain”. (Please see the 'Examples’ section for further guidance on the type of information the FIU expects to receive).

In the absence of the required information, you will be provided with an Acknowledgment Letter in the first instance, which will usually state:

“Thank you for your disclosure of [ ]. We acknowledge receipt of your SAR/Continuation Report dated [ ].

Having regard to your suspicions and your obligations under the POCJL; the FIU note you have sought consent under Article 32(4) of the POCJL 1999. Before such consent can be properly considered (or provided), the FIU seek further detailed understanding from you as to the specific act(s) for which you seek consent, in this case to [operate [1] ].”

[1] Subject to change dependent on the actual consent request.

An Acknowledgement Letter of this kind should not be construed as FIU consent.

The Acknowledgment Letter principally serves as a holding response until such time that the FIU is furnished with sufficient information to enable it to assess the consent request and provide an appropriate response.

Accordingly early provision of clear and full information in support of a consent request is recommended. In the intervening period, it will be for the Financial Institution to manage their client/customer relationship based on its suspicion that gave rise to the submission of the SAR/Continuation Report.

Examples

The below examples are for illustrative purposes and are not intended to set out an exhaustive list of matters to be considered and included within consent requests. Financial Institutions will need to consider each SAR on its own facts when considering what constitutes appropriate information in support of a consent request:

Consent to operate/maintain:

1. If you are seeking to ‘operate/maintain’ the relationship in the ordinary course of business, the FIU requires clarification as to the exact nature of what the ‘operation/maintenance’ will entail on an ongoing basis.
2. Any such consent request must include what actions have been (and just as importantly are going to be) taken in respect of your money laundering suspicion. For example,
   • in the context of a banking relationship, the FIU might expect details clarifying whether: access to online banking has been internally blocked; ATM transactions have been suspended; enquiries are underway with the subject to understand the third party nature of the payments received into the account, or cash lodgements, which gave rise to the suspicion.
3. Consent for a specific payment or transaction: If you are seeking to undertake a specific payment or transaction, the FIU will need information to enable it to understand the proposed act, why it is considered that the act should be carried out in light of your money laundering suspicion(s) and how you intend to mitigate the problems; and what (if any) implications there might be if consent is not provided.
4. For example, in a trust relationship –
   • it may be that consent is sought for a single distribution to be made to a beneficiary from trust assets.
   • These are the same trust assets which you suspect (in whole or part) contain the proceeds of criminal conduct. In this case, the FIU would require from you information to include full details of the distribution (when the distribution is to be made, full details of the beneficiary); why the distribution should be made and how it does not (in your view) contain the proceeds of criminal conduct; if the distribution was not to be made what implication(s) may result.

Consent to “Exit”: If you are seeking consent to “exit” the relationship the FIU would require clarification of the nature of the payments/transfers/other transactions involved in the “exit” (See above)

https://jersey.police.uk/media/591275/Updated-Guidance-FIU-response-to-SARs.pdf