Reporting to the FIU
According to Section 20a of the Wwft, financial instituions must have procedures in place that allow employees to report Wwft violations independently and anonymously. Before a company can make a Wwft report, it must first register with the FIU. You can read whether your company is liable to report on the FIU-Nederland website.
For completeness, we mention that you are obliged to report to the regulator if a client appears on the sanctions lists. If this is the case, you are also obliged to freeze any assets.
Objective indicators Wwft
If a transaction meets an objective indicator, it is mandatory to make a Wwft report to the Dutch FIU. An example of an objective indicator is a cash exchange transaction of more than €10,000 or the use of a credit or prepaid card for a transaction of €15,000 or more. For subjective indicators, a company is only required to make a report if there is reason to believe that the transaction may be related to money laundering or terrorist financing. The company must make its own judgement as to whether this is the case. An example of a subjective indicator is a customer’s declaration of assets that does not appear to be very credible.
There is no fixed list of subjective indicators, as they vary from institution to institution. However, you can consult the AFM’s Guideline Wwft, Wwft BES and Sanctions Act, which contains examples for illustrative purposes.
Objective indicator high-risk countries expired
In October 2019, the decree amending the 2018 Wwft implementation decree was published. One of the changes is that the ‘Objective 02’ indicator, the so-called objective indicator for high-risk countries, has been removed. This means that transactions by or on behalf of a (legal) person in a high-risk country no longer need to be reported as an unusual transaction.
However, the removal of this objective indicator does not mean that the list of high-risk countries is no longer relevant. On the basis of a subjective indicator, unusual transactions must still be reported.
Transactions that meet an objective indicator must be reported without delay, in any case within fourteen days of being established. Section 16(2) Wwft lists what exactly must be included in the report:
- the identity of the client and, where possible, the identity of the person for whose benefit the transaction is carried out;
- the nature and number of the client’s proof of identity;
- the nature, time and place of the transaction;
- the amount, destination and origin of the funds, securities, precious metals or other values involved in the transaction;
- the circumstances under which the transaction is considered unusual;
- a description of the relevant items of great value in case of a transaction above €15 000.
The considerations for reporting a transaction must be made sufficiently clear and clearly recorded. If there is doubt as to whether a transaction is unusual, it is better to report it to FIU-the Netherlands. After all, if an institution does not comply with the reporting obligation or does not do so in time, it commits an economic offence.
Articles 19 and 20 of the Wwft explicitly state that reports to FIU-the Netherlands and the data provided in the process may not be used to prosecute the financial institution for involvement in money laundering or the financing of terrorism. Nor can the company be held liable for damages to third parties as a result of the Wwft report made.
Transaction monitoring e-learning
How do you analyse and evaluate the information you have about a transaction? How do you draw conclusions? And finally, how do you record your conclusions? You will learn all this in the Transaction Monitoring e-learning course from our training institute, The Ministry of Compliance.
