Reporting to the FIU
Article 20a of the Wwft mandates that financial institutions have procedures in place allowing employees to report Wwft violations independently and anonymously. Before submitting a Wwft report, companies must register with the FIU. Check the FIU-Nederland website to determine if your company is required to report.
Furthermore, you must report to the supervisor if a client appears on the sanctions lists. In such cases, you are also required to freeze any assets.
Objective indicators Wwft
If a transaction meets an objective indicator, it is mandatory to make a Wwft report to FIU-Nederland. 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. A company is only required to make a report for subjective indicators if there is reason to believe that the transaction may be related to money laundering or terrorist financing. The company must determine, based on its own assessment, whether this is the case. An example of a subjective indicator is a customer’s declaration of wealth that does not appear very credible.
There is no fixed list of subjective indicators, as this varies per 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 unusual transactions.
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 identified. Section 16(2) of the 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 the 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-Nederland. 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-Nederland 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 analyze and evaluate the information you have about a transaction? How do you draw conclusions? And, importantly, how do you document these conclusions? You will learn all of this in our Transaction Monitoring e-learning course, which we offer through our training institute, The Ministry of Compliance.
