Is your business doing enough?

It’s a hard question for any business owner but one that we should ask ourselves daily. Apart from realities in meeting your targets to cover costs or hit profits, there are more and more matters to be concerned about as to whether your business is doing ‘enough’. Apart from doing ‘enough’ to hit the bottom line – you have more things to worry about. Are you doing ‘enough’ for your employees? ‘Enough’ marketing? ‘Enough’ for the environment? Enough for the jurisdiction? – quite frankly those of us in regulated sectors already have enough ‘enoughs’ to worry about.

The most recent and topical ‘enough’ that you might want to be concerned about is whether you are doing enough to meet your business’ obligations in respect of compliance. No matter the size of your business and industry, today’s reality is that all businesses have increasing obligations on compliance.

What you didn’t know

Quite often small business owners in traditional retail or service-based sectors think that matters of compliance are only for ‘regulated’ businesses such as financial services or gaming companies. Even business owners of medium to large businesses with significant turnover volumes can think that these obligations are not applicable to them. However, the truth is that nowadays businesses of all sizes and sectors are likely to have a range and varying degree of obligations relating to compliance.

Compliance comes in all shapes and sizes and of many types, but most topically are the concerns relating to money laundering, financial crime and terrorist financing. Internationally there has been a rising tide of efforts to combat money laundering and terrorist financing. This has come to the shores of the EU in a number of waves in the form of various Anti-Money Laundering Directives and in Gibraltar in the introduction of Gibraltar’s Proceeds of Crime Act 2015, the Terrorism Act 2018 and Sanctions Act 2019 among other key pieces of legislation on related compliance.

Moneyval

These matters are particularly topical as Gibraltar as a whole has recently undergone an assessment of its approach to anti-money laundering and curtailing the financing of terrorism and financial crime. The evaluation was carried out by Moneyval, the Council of Europe’s anti-money laundering body, and the report sets out a number of key findings. Whilst an evaluation of the evaluation is a topic for a whole other article, what is important to note for business owners is to understand that all businesses are exposed to falling victim or being used for money laundering or other financial crime activities.

Other key points to note from this evaluation are that the jurisdiction needs to do more in reporting potential suspicious activity. Some businesses, even if they are not in the regulated financial services sector have obligations to report suspicious activity and carry out due diligence on their customers. If these things are not done, individuals in the business could be committing criminal offences chargeable with custodial sentences and fines.

The most recent Gibraltar National Risk Assessment sets out the various types of industry and their particular vulnerability to being used for money laundering or terrorist financing and also the threat of that risk. This is a good starting point to understand your business’ role, potential risks to activities and how to understand potential suspicious activity.

With all of the above said – do you think your business is doing enough to meet its obligations? Is your business doing enough to help the jurisdiction meet its objectives?

Take a view

If you are not sure whether your business is regulated under the legislation mentioned, or you want to find out more on how to improve your current policies and processes please feel free to get in touch with any of our experienced team for a meeting or call.

We help a number of businesses with a range of compliance matters that include helping small businesses recognise that they have obligations under Gibraltar laws and introducing policies and controls to ensure compliance. We also help internationally regulated firms with a Gibraltar presence in updating their policies to ensure that their particular Gibraltar activities are covered. We are also in a position to provide relevant training and if you are required to have individuals responsible under legislation, we can help you consider suitable persons for the function. 

TLDR; Whether you are a regulated business or not you may still have requirements under AML/CFT laws to screen clients and/or report suspicious activity.