Legislative developments against money laundering crimes and their effects on investment An applied study on the fifth directive of the European Council 5AMLD: 02/10/2020

Professor Doctor khaled moustafa

Criminal law - The College of Criminal Justice - Naif Arab University for Security Sciences

Abstract

Legislative developments against money laundering crimes and their effects on investment An applied study on the fifth directive of the European Council 5AMLD: 02/10/2020 There is no doubt that the texts currently in force in the field of combating money laundering crimes, especially the FATF recommendations, revealed some weaknesses, and the efforts of the European Council in issuing the fifth directive issued in June 2018 to be adopted on January 10, 2020 contributed to establishing legislative rules and developments that do not Restricted to the national side, but rather has an international character and protects the digital market and electronic commerce. It can be considered a starting point for protecting investment. These developments focus on six main axes: 1- Banking and non-banking institutions: They must be subject to the necessary care measures to ensure the wire transfers, des virements mobiles, the identity of senders and recipients of funds, and to verify this identity effectively and permanently, using innovative financing methods. And attention to the principle of knowing your customer (KYC)) not to open an account for the customer unless you find complete documents to verify the identity of the customer, and to prohibit opening the account for all inflows and outflows of funds in the event that data or private documents cannot be provided, and monetary transactions are monitored. 2- Commercial companies: that engage in activities related to electronic commerce, it is necessary to verify the existence of the economic right, the nature of the commercial transaction, and shipping documents, as money launderers exploit the front companies, especially the “Le Schtroumpf coucou” ou le blanchiment technique that criminal organizations use in laundering operations. Funds, and the European Commission has created an AML5 electronic commerce "electronic unified market" through global standards such as PSD2, AML5, eIDAS, GDPR, which relies on the standardization of e-solutions identification for European Union countries and the regulation of trade relations that take place via a technician. E-commerce between member states, protecting consumer rights from electronic fraud and commercial fraud, and preventing the use of commercial activities for money laundering purposes. 3- Financial intermediaries: who own companies or branches abroad by setting measures that obligate them to submit and implement reporting and control procedures for money laundering operations, and to verify information and data from reliable sources, and that the beneficiary is the real owner through: (periodic risk analysis, regular monitoring of cases of laundering Funds, preparing consolidated reports that combine qualitative and quantitative information useful, setting a unified set of rules against money laundering in all branches). 4- Virtual service providers: “prestataire de services en actifs virtuels. They are charged with exchanging virtual currencies and cryptocurrencies, (Bitcoin type) and e-wallet service providers. AMLD” so that they are subject to state supervision where they conduct financial activities (such as asset preservation) Digital on behalf of third parties, buying and selling digital assets in exchange for legal tender currency, and operating the digital asset trading platform (stock market). 5- Combating the crimes of cyber-penetration of the Internet for financial and banking institutions and ATM networks (stock exchanges, and the SWIFT network) to steal customer accounts and transfer funds abroad by activating digital judicial cooperation to combat these crimes as it is one of the sources of illicit funds exploited by money launderers. 6- Report of international responsibility on countries to freeze their bank accounts and include them in the blacklist, as well as commercial companies by imposing financial penalties on them from the value of their annual sales or suspending their activities. Indeed, we hope that the efforts of the European Council will constitute an experiment that can be used in our Arab countries, and we recommend the Arab League to adopt the same. From this, the main question of this research was, are there legislative developments in the Arab League to combat money laundering crimes that protect investment and electronic commerce?

Keywords

Fifth Directive of the European Council, Money Laundering, Banking and Non-Banking Institutions, Commercial Companies, Financial Intermediaries, Providers of Virtual Services, Combating Cyber Penetration