"MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAunder-regulated sector and Section 331 explains about the conviction of failure to disclosethe officers who have been nominated under the regulated sector. Section 327 of the actexplains that the act of concealing, disguising, transferring or converting of a criminalproperty is also recognized as a crime under UK legislation.Below table gives a brief idea of the different offences that are considered as offences underUK legislation:38 ANTI-MONEY LAUNDERING LAWS – THE UKAs stated in the above section The UK even tough being one of the prominently developednations and spectrum to other nations has been one of the attractive areas for the moneylaunderers. But is this crime still in existence in the nation or measures have been taken tofight against it is the topic of discussion under this section.38Source: F:\\Strategic Policy Directorate\\Public Affairs\\Corporate Affairs\\Corporate Affairs\\Money launderingPN\\amllegislation_guidance2002.doc; Page no. 43 Page 22 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAThe process of money laundering is the term used for different offences that have involvedfunding of terrorism and the crime proceeds. UK authorities have implemented and taken partin enacting many international measures for eradicating the deep-rooted crime of moneylaundering. One of such effective moves is the ratification and enforcement of the Europeanfirst directive in the year 1986 which dealt with the prevention of using the financial systemof the nation for the process of money laundering.Additionally, we will precede further in the dissertation by understanding in detail thedifferent measures that have been implemented by the nation under its scope of eradicatingthe roots of this evil. The nation has taken the measure to participate in the Basle Committeemovement that deals mainly with the enactment of some of the most deterrent principles onmoney laundering and also the banking regulatory and supervisory activities in 1988 thathave been implemented for eradicating this evil.Before the enactment of the EU first directive in the year 1986, there is no clear evidence thatthe domestic legislation of the UK has particularly been implementing measures foreradicating of this crime. There had been no particular laws for recognising this crime and theauthorities mainly relied on the Theft Act 1968 and the Misuse of Drug Act 1971 whileprosecuting such type of activities. The first move by the UK authorities to fight against theevils of money laundering is the enactment of the Drug Trafficking Offences Act in the year1986. The enactment of this act can be observed as the first encouraging step of this nation?sauthorities targeting the drug traffickers. With time legislations were laid to target the threatthat has been imposed on UK authorities by the terrorist groups.In the recent years the nation has enforced many acts on money laundering by shifting theburden of fighting against this crime away from the government agencies but towards those Page 23 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAinstitutions and organisations that have been established with the motto to eradicate this evil.It can be observed that the scope of AML in UK has been expanding in the later times fromdrug trafficking to targeting of the money laundering criminal proceeds in general and also increating new offences that are in relation to any form of money laundering that been recentlyobserved. One of such central piece of legislation is the implementation of the CriminalJustice Act of 1993.The AML governing the prevention and controlling of money laundering have beensegregated under three different heads such as: firstly, all the primary legislations that havebeen enforced by the government to deal with money laundering such as the Criminal JusticeAct 1993, the Drug Trafficking Act 1994.Secondly, the important Money launderingRegulations laid down in 2003 that were replaced by the 2007 regulations and are directlybased on the European Union directives such as 91/308/EEC, 2001/97/EC and 2005/60/EC,39 thirdly, the guidance given by the trade associations and the regulatory authorities.The other regulatory organisations that have been formed with the aim of reducing the act ofmoney laundering are the important obligations that have been specified under the Proceedsof the Crime Act 2002 – that contains the primary legislation of UK on AML. This actprovides a single set of offences throughout the UK that fall into the bracket of moneylaundering which are considered as proceeds of crime, additionally it also established theregime of disclosure and were applicable to all the solicitors and also to those individualswithin the nominated officers and sectors that are regulated. The act states that the three main39Further changes expected as a result of the passing of the 4th EU Money Laundering Directive Page 24 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAelements such as knowledge, suspicion and reasonable grounds for suspicion are rudiments40 of the actual offence.The Money laundering Regulation 2003 - that aimed at expanding the definition of moneylaundering by broadening its definition of money laundering and in-turn increase the numberof activities under money laundering that have been caught by the specific authorities. Inparticular it can be observed that the responsibility of reporting suspicions of moneylaundering activities has strengthened, and criminal offences are imposed on all those41 individuals who can be held liable for failing the reporting duty on money laundering.CHALLENGES & RECOMMENDATIONSAs we have understood in brief the different the different legislations dealing in the AML inthe UK we proceed further in understanding the different challenges and recommendationsfor improving the standards of AML in the nation and reduce money laundering.Challenges:The challenges faced in the implementation of the AML laws are not confined to one nationbut are almost similar globally. Every nation globally plans in its way through its legislationsto fight money laundering, and it can be observed that the challenges faced are similar. Thechallenges include:o Challenge to identify laundering of money:The most important challenge in the implementation of AML laws is firstlyidentifying the existence of money laundering process in the given situation. No40However, the third element is applicable to offences recognized under regulated sector; Chapter 5 – MoneyLaundering Offence, The Law Society, October 2013; http://www.lawsociety.org.uk/support- services/advice/practice-notes/aml/money-laundering-offences/ 41 Anti-Money Laundering Guidance and Procedures,Wealdon District Council, p. no. 2 Page 25 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAindividual or organisations are willing to provide information on any suspiciousactivity to the authorities with fear. There are even situations where the individual feelthat it is neither their responsibility nor concern that they should shoulder theresponsibility of reporting any suspicious activity that may result in money launderingto the relevant authority. It is very essential that government of every nation take stepsin this lead such that activities involving money laundering are being reported to theauthorities who can take the additional steps.o Challenge to identify the organisations financing terrorism:As stated above if identifying laundering of money is a big challenge the otherchallenge is to identify those organisations that finance terrorism. It is very essentialto overcome this challenge such that it would help the authorities to even identify thefunding organisations that are involved in money laundering. The challenge inidentifying the organisations financing the terrorism may depend based on the part ofthe world the crime as occurred. For example, statistics state that the LondonUnderground bombers on 7 July 2005, that have been used in the region were beingfinanced through legitimate bank channels that is through those people who wereconsidered to be the bona fide customers of the bank. It is very challenging to identifythese customers even through the AML procedures such as know your customer42 (KYC) or through other regulatory procedures.o Compliance with the money laundering obligation:Despite the regulated environment and the stringent legislations, it has become a hardtask to overcome the fact that The UK is still the fastest-growing hub in the crime ofmoney laundering. Irrespective of the continuous statement by the director-general of42Anti-money Laundering Challenges, Financier Worldwide , Talking point – fraud & Corruption;http://www.financierworldwide.com/anti-money-laundering-challenges/#.VfHi3p-qqkoPage 26 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAthe National Crime Agency (NCA) the funds still flow to the money launderingorganisations through the channel of banks and their subsidiary branches. Thus, thecall for cleaning of the city and tackle these finance gatekeepers for the money- laundering institutions has been increasing in a greater fold. The UK?s road to theassessment of the Financial Action Task Force (FATF) presents both opportunitiesand challenges in the process of cleaning the nation from the dirt of moneylaundering. The challenge of compliance arises due to continuous austerity by thegovernment to prove compliance through effectiveness and this shift near future maybe observed as a big challenge impacting the results of AML in the run up to 2018.However, irrespective of these challenges it can be observed that there have beenappreciable developments in the UK?s approach to AML/CTF since the year 2007, themain reason behind this appreciable development is most probably the MoneyLaundering Regulation 2007 that has helped in sealing many gaps that have beenidentified during the FATF?s evaluation.It can be observed that in regards to the effectiveness of regulation of the above ACTUK has been in the forefront on implementing certain innovative measures in thisfield such as the recent launch of the Joint Money-Laundering Intelligence Taskforce(JMLIT) and additionally, the reputation of the nation as one of the leading facilitatorof the money–laundering globally has paved way for the government to take essentialsteps to boost both AML/CTF technical compliance and effectiveness. As we haveunderstood certain challenges and briefly the available opportunity we move furtherin understanding the important recommendations to be made to the UK government Page 27 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAand different AML organisations for reducing the growth of money laundering in the43 nation.Recommendations:Under this section, we would be discussing briefly on the different recommendations thatwould help us in combating money laundering or help in making the procedure moreeffective. It is essential to note that mobilising the international community and thecombating of money laundering go hand in hand and thus with the reinforcement of theinvestigatory power of the police and improvement in the co-ordination of legal servicesand financial institutions cooperation it could be possible to combat money laundering. Themost important recommendations include the maintenance of cooperation among theinternational police departments, working with the private sectors, developing senseresponsibility among the individuals and the organisations that have become base formoney laundering, measures for recognising and investigating thoroughly on the banktransactions if confirmed suspicious, encouraging individuals to report any suspiciousactivities and provide security to those who have reported these activities by not disclosingtheir information such that fear would not play major role in the given situation and preventthem from disclosing the suspicious activities.In addition to the above-stated recommendations, this chapter will also help us in supportingour argument on money laundering with the help of certain important case laws as discussedbelow.CASE STUDYIn the current section, we would be discussing in briefcase laws that explain the differentcircumstances where the offences have been convicted of criminal offences under POCA.43Wood Helena, FATF 2018: Assessing the UK’s Anti Money-Laundering Efforts, RUSI Analysis, July 2015;https://www.rusi.org/analysis/commentary/ref:C55818D0A18AEC/#.VfHmHJ-qqkoPage 28 "