MONEY LAUNDERING REGULATIONS IN THE PERSONAL EQUITY PLAN INDUSTRY
| Pages | 269-277 |
| DOI | https://doi.org/10.1108/eb024815 |
| Date | 01 April 1994 |
| Published date | 01 April 1994 |
| Author | SHEILA GATES |
| Subject Matter | Accounting & finance |
MONEY LAUNDERING REGULATIONS IN THE PERSONAL
EQUITY PLAN INDUSTRY
Received: 4th July, 1994
SHEILA GATES
SHEILA GATES
IS
COMPANY SECRETARY OF THE ALLIANCE
TRUST
PLC. SHE IS A SOLICITOR WHO ALSO
ACTS AS COMPLIANCE OFFICER OF THE
TRUSTS PERSONAL EQUITY PLAN SUBSIDIARY.
ABSTRACT
The purpose
of
this
paper is to
look
at the
practical
implementation
of
procedures
to
comply
with
the money laundering
regula-
tions in the
Personal
Equity Plan (PEP)
industry and
argues
that
compliance
with
them is in
accordance
with
best practice
under the PEP regulations.
The Money Laundering Regulations1
(MLR) came into force on 1st April,
1994,
an appropriate date in the
opinion of those who saw their
introduction as an unjustifiable
intrusion into the personal circum-
stances of private investors and an
attempt to make financial businesses
the unpaid arm of the law enforce-
ment agencies. A disbelief as to the
implications of the MLR and a feel-
ing that reputation or standing
somehow conferred some kind of
exemption, led to a slow awakening
that the MLR were here to stay with
awesome consequences for those
who ignored them. In the Personal
Equity Plan (PEP) industry, it came
as something of a surprise to realise
that plan managers would be
affected, despite the arguably low
risk of a PEP being used as a vehicle
for money laundering because of the
requirement that no PEP can be
opened without a record of the
investor's National Insurance num-
ber, and the monitoring which is
already in place by the Inland Reve-
nue.
This was particularly so for plan
managers operating a PEP which
does not have a cooling-off period,
the absence of which must itself be a
deterrent to any money launderer
as,
once funds are subscribed, the
PEP is activated and becomes a live
one as far as the Inland Revenue is
concerned. However, the discovery
by the Inland Revenue of a false
National Insurance number could
lead to an investigation with MLR
implications and it would be then
269
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