Financial systems facilitate economic development by connecting savers and investors through banks. To mitigate risks, an internal anti-money laundering audit must be carried out annually. However, financial systems are not perfect, and certain criminals have found their weak points to convert their illicit money into lawful funds; this conduct is known as money laundering and is a criminal offence under Article 301 of the Criminal Code.
To reduce criminal conduct and activities, a series of obligations have been established. These serve to control and reduce risk. The state, through Law 10/2010 on the prevention of money laundering and the financing of terrorism, requires these organisations to cooperate in this prevention.
Money laundering can be integrated with the ISO 9001 certificate and is related to corporate compliance.
What does a money laundering audit involve?
An audit is an external review carried out by an independent auditor to examine and assess the internal control measures in place. This involves verifying the annual report and its subsequent submission to the Executive Service of the Commission for the Prevention of Money Laundering and Monetary Offences (SEPBLAC).
If your company is a regulated entity and you have not yet implemented an anti-money laundering system, you may find the following link useful: Anti-money laundering system.
Who is required to carry out this money laundering audit and report it to SEPBLAC?
Article 2 of Law 10/2010 stipulates that the following are required to undergo this external audit:
- Financial or credit institutions.
- Life insurance companies and insurance brokers.
- Investment firms.
- Pension fund management companies.
- Mutual guarantee societies.
- Currency exchange professionals, etc.
- Independent professionals in the legal and economic sectors: Auditors, external accountants, tax advisers, solicitors and barristers, notaries and land registrars, etc.
- Commercial and property companies.
- Foundations and associations.
What happens if I don’t take the external exam?
Entities required to undergo a money laundering audit and subsequently report the results to SEPBLAC that fail to fulfil their obligations within the specified timeframe and in the prescribed manner may be committing minor, serious or very serious breaches of Law 10/2010. The minimum fines are €60,000.
It is very important to carry out the ‘anti-money laundering audit’ periodically, in order to comply with the law and to help ensure that our financial system remains free from money derived from illicit activities.