Published by Simbiosis Inc.
AML Digest
July|August 2018
>> IN THIS ISSUE Beneficial Ownership
This issue is dedicated to Louis Parris
a deep dive into the issue of
Beneficial Ownership (BO)
which has far reaching impli-
cations over a wide spec-
trum including risk, transpar-
ency, blacklisting, De-risking
and BEPS. It lays out the
background which is critical
to understanding why BO is
A colleague in the anti-money laundering field recently remarked that in at-
tempting to discover the beneficial ownership of some companies, it often
seems like when you peel back a layer of identity and you think you are going
to see what you should be seeing, there is often another layer to be shed; this
could continue indefinitely to the point where you want to give up in frustration.
Beneficial ownership has taken the spotlight recently as regulators in Europe
and the US seek to introduce more tools in addi-
tion to FATCA, CRS, under BEPS CbCr, and other
“It is extremely difficult to quan-
Anti-money Laundering rules which are de-
tify with any precision the ex-
signed to discover on the one hand who may
tent of misuse of corporate ve-
laundering money and on the other who are
hicles for illicit purposes. None-
placing what assets offshore. The push toward
theless, a number of reports
transparency in beneficial ownership has accel-
and surveys have concluded
erated since the publication of the “Panama
that corporate vehicles are used
Papers” leak in 2016.
extensively in criminal activities.
so important.
For example, a recent survey
Without doubt the vast majority of the world’s
conducted of EU member States
corporations are formed for legal purposes and
indicated that almost every
conduct legal business. However the rise of cor-
criminal act, including economic
ruption, white collar crime, the illegal drug trade
crimes, involves the use of legal
and tax evasion has seen a rapidly increasing
persons”
tendency to subvert corporate entities for illicit
activity. An OECD report “Behind the Corporate
Veil -Using Corporate Entities for Illicit Purposes” states “It is extremely difficult to
quantify with any precision the extent of misuse of corporate vehicles for illicit
purposes. Nonetheless, a number of reports and surveys have concluded that
corporate vehicles are used extensively in criminal activities. For example, a re-
cent survey conducted of EU member States indicated that almost every crimi-
nal act, including economic crimes, involves the use of legal persons”
Louis A. Parris
Dip (Compliance) FICA; Certified
Professional | CAMS | CAMS-Audit
Louis Parris is the editor of this
newsletter. Louis has over 30yrs
commercial banking experience
and is a highly qualified compli-
ance consultant. He has written
several articles for the Barbados
Business Authority and guest
lectured at the University of the
West Indies (UWI) Cave Hill
Campus.
Beneficial ownership seeks to establish where both ownership and control reside
in corporate vehicles. A prima facie ownership may not be the same as control.
In October 2014 the Financial Action Task Force (FATF) issued “FATF guidance -
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