What is the role of the insurance sector in the fight against fraud and money laundering?

THE money laundering is a practice of introducing illegal operations funds into the economic system, using different stratagems. Tax, social and customs fraud, scam, drug trafficking, corruption, theft … Sources of money laundering are numerous and their identification is all the more complex.

To increase its effectiveness, the national system for combating capital laundering and terrorism financing involves more and more actors, in the public sphere as in the private field. Naturally, the sector of Bank-Assurance is on the front line as part of the LCB-FT. The system was also extended in 2021 to insurance companies, mutuals and unions, as well as insurance intermediaries.

From now on, All insurers have the obligation to benefit from in -depth knowledge of their customers And to carry out checks on the identity of people, but also the SIREN number of companies. In addition, they must report each year of their LCB-FT system to the Prudential Control and Resolution Authority (ACPR)which has the power to sanction them in the event of non-compliance.

What are the main axes of the LCB-FT in insurance?

Published in the Official Journal on January 16, 2021, the decree of January 6, 2021 relating to the system and internal control in terms of LCB-FT and freezing of the assets describes the main axes of the system.

Risk classification

Regulations require formal identification and documented risk assessment When launching new products, services or business practices.

Products or services using new technologies or distribution mechanisms (such as artificial intelligence and blockchain) are also concerned.

This classification must be established taking into account:

  • Risk assessment.
  • Internal and external events likely to affect the insurance company.
  • Information disseminated by the Ministry of Economy and Finance, by the Financial Action Group (GAFI) or by Tracfin.
  • Publications of the European Union or the Organization for Economic Cooperation and Development (OECD).

Note that the risk classification must be updated regularly.

Governance

The missions of Responsible responsible for defining and implementing the LCB-FT system are detailed by law. They include:

  • Validation of the classification of risks and internal procedures.
  • Control of the implementation of the system by the subsidiaries and branches established abroad.
  • The information of managers and the surveillance body vis-à-vis the evolution of the LCB-FT system and the actions deployed in this area.

Risk management

Finally, the regulations recall that This system for combating money laundering and financing terrorism is based on customer knowledge. It must therefore make it possible to effectively detect atypical or suspicious operations, and then treat alerts.

What checks to set up within the framework of the LCB-FT?

As part of the LCB-FT, insurance companies have the obligation to carry out controls from various registers made available by the State.

Asset frost

The Directorate General of the Treasury provides a Consolidated list of people subject to asset freezing measures applicable in France. Thus, insurance players must immediately apply freezing decisions of the United Nations, the European Union or the French government.

In addition, they must be able to detect operations aimed at knowingly and voluntarily bypassing the assets of assets and prohibition for making or use of funds.

The register of effective beneficiaries (RBE)

The European directive 2018/843 of May 30, 2018 placed the Register of effective beneficiaries in the center of the preventive system. Indeed, the RBE consultation is compulsory for insurance companies, in the event of a new entry into business relations.

In addition, a mechanism has been introduced to report any divergence between the register and the information held on the effective beneficiaries.

Non -cooperative countries and territories (PTNC)

The list of non -cooperative countries and territories (PTNC) must also be taken into account when assessing the risks linked to a customer. She lists non -members of the European Union that encourage abusive tax practices and which harm the product of the corporate tax of the Member States.

Politically exposed people (PPE)

Finally, insurers have access to a database allowing them to Check if their customer is on a list of PPEnamely persons exposed to high risks of money laundering, in particular corruption, due to the political, jurisdictional or administrative functions they exercise or that they have exercised.

The regulations on the fight against fraud, tax evasion, money laundering and the financing of terrorism requires insurance companies the implementation of numerous internal procedures. However, the deployment of this device can be particularly heavy and complex.

To save you time while guaranteeing your regulatory compliance, Infoelsa provides you with a management system incorporating all compulsory controls within the framework of the LCB-FT: Gel of assets, PPE, RBE, PTNC …