María del Carmen Miquel Lasso de la Vega EUROPEAN DIRECTIVES AND THE ROLE OF THE LAND AND BUSINESS REGISTRIES AGAINST MONEY LAUNDERING AND TERRORISM María del Carmen Miquel Lasso de la Vega Washington 20th March 2018

Index: 1. European directives 1.1. Suspicious subjects 1.2. The essential aim is to find who the real owner is 1.3. Available information 1.4. Interconnection of National Central Registries 2. The role of the land and business Registries against money laundering and terrorism 2.1. Looking for the real owner 2.2. C.R.A.B. Land Registries Anti-money Laundering and Terrorism Financing

Directive (EU) 2015/849, the 5th anti-money laundering Directive: The main legal instrument in the prevention of the use of the Union's financial system for the purposes of money laundering and terrorist financing It pursues the maximum possible transparency in financial transactions and all kinds of trust The Land and Business Registries can collaborate as an essential tool to fight against money laundering. This is why the Land Registries of Spain have created a special office to control and prevent money laundering and terrorism financing Next step is the interconnection between Land Registries and Business Registries in Europe.

Index: 1. European directives 1.1. Suspicious subjects 1.2. The essential aim is to find who the real owner is 1.3. Available information 1.4. Interconnection of National Central Registries 2. The role of the land and business Registries against money laundering and terrorism 2.1. Looking for the real owner 2.2. C.R.A.B. Land Registries Anti-money Laundering and Terrorism Financing

Directive 2015/849 says in its article 3 Directive 2015/849 says in its article 3.6 people which must be identified: Natural persons who have a stake of over 25% in company’s share capitals, or own more than 25% of the costumer’s base Article 30 refers to trust: In the case of trust - all following persons: (i) the settlor(s); (ii) the trustee(s); (iii) the protector(s), if any; (iv) the beneficiaries; or where the individuals benefiting from the legal arrangement or entity have yet to be determined, the class of persons in whose main interest the legal arrangement or entity is set up or operates; (v) any other natural person exercising ultimate control over the trust by means of direct or indirect ownership or by other means.";

Directive 2015/849 says in its article 3 Directive 2015/849 says in its article 3.6 people which must be identified: And article 31 to fideicomisos: In the case of trusts - all following persons: (i) the settlor(s); (ii) the trustee(s); (iii) the protector(s), if any; (iv) the beneficiaries; or where the individuals benefiting from the legal arrangement or entity have yet to be determined, the class of persons in whose main interest the legal arrangement or entity is set up or operates; any other natural person exercising ultimate control over the trust by means of direct or indirect ownership or by other means."

Index: 1. European directives 1.1. Suspicious subjects 1.2. The essential aim is to find who the real owner is 1.3. Available information 1.4. Interconnection of National Central Registries 2. The role of the land and business Registries against money laundering and terrorism 2.1. Looking for the real owner 2.2. C.R.A.B. Land Registries Anti-money Laundering and Terrorism Financing

This data must been kept in a National Central Registry such as could be the business or societies Registry or even another public Registry. This information must be: adequate, accurate and current on their beneficial ownership, including the details of the beneficial interests held. Member States shall ensure that breaches of this Article are subject to effective, proportionate and dissuasive measures or sanctions

Index: 1. European directives 1.1. Suspicious subjects 1.2. The essential aim is to find who the real owner is 1.3. Available information 1.4. Interconnection of National Central Registries 2. The role of the land and business Registries against money laundering and terrorism 2.1. Looking for the real owner 2.2. C.R.A.B. Land Registries Anti-money Laundering and Terrorism Financing

The information on the beneficial ownership is accessible in all cases to: (a) competent authorities and FIUs, without any restriction; (b) obliged entities, within the framework of customer due diligence in accordance with Chapter II" (c) any member of general public …The persons referred to in point (c) shall be permitted to access at least the name, the month and year of birth and the country of residence and nationality of the beneficial owner as well as the nature and extent of the beneficial interest held Unrestricted access by competent authorities and FIUs to all information held in the Central Registry

Index: 1. European directives 1.1. Suspicious subjects 1.2. The essential aim is to find who the real owner is 1.3. Available information 1.4. Interconnection of National Central Registries 2. The role of the land and business Registries against money laundering and terrorism 2.1. Looking for the real owner 2.2. C.R.A.B. Land Registries Anti-money Laundering and Terrorism Financing

The information referred to shall be available through the national registers and through the system of interconnection of registers for at least 5 years and no more than 10 years after the corporate or other legal entity has been struck off from the register By 26 June 2020, all trusts and legal arrangements which have a structure or functions similar to trusts governed under the law of Member States were duly identified and made subject to the obligations as set out in this Directive

Index: 1. European directives 1.1. Suspicious subjects 1.2. The essential aim is to find who the real owner is 1.3. Available information 1.4. Interconnection of National Central Registries 2. The role of the land and business Registries against money laundering and terrorism 2.1. Looking for the real owner 2.2. C.R.A.B. Land Registries Anti-money Laundering and Terrorism Financing

Nowadays Spanish law does not allow knowing who the real owner in societies is because stake transactions only need public deed, and isn’t mandatory inscription, shares doesn’t need it either Notaries have a data base which obtain those data from public deeds, but: 1- Judges and Courts consider in most cases that public deed aren’t necessary for these transmitions 2- These deeds are, above all acts of statement 3- Criminal organisations do their conveyance with foreings notaries, in order to avoid this control 4- Stakes, shares or other kind on titles can be persecuted, be the subject of legal action by judges or administrative agents and those data aren’t integrated in the Notaries systems

What is the solution? The inscription of the transactions of the stakes in the Business Registries As a consequence… Ownership will be garantied and protected by law, Owner could improve its financial capacity, Member States will have a reliable tool States will benefite from having it to improve their financial situation and investments

Index: 1. European directives 1.1. Suspicious subjects 1.2. The essential aim is to find who the real owner is 1.3. Available information 1.4. Interconnection of National Central Registries 2. The role of the land and business Registries against money laundering and terrorism 2.1. Looking for the real owner 2.2. C.R.A.B. Land Registries Anti-money Laundering and Terrorism Financing

LAND REGISTRY ANTIMONEY LAUNDRING AND TERRORISM FINANCING OFFICE (C.R.A.B.)

C.R.A.B. : LAND REGISTRY ANTIMONEY LAUNDRING AND TERRORISM FINANCING OFFICE AIM: PREVENTIVE COLABORATION AND ALSO FOLLOW UP AND PENALIZATION MONEY LAUNDRING Collaboration from the beginning: 1- Law 19/1.993 it is not directly referred to land and Business Registars but it existed a general obligation on the part of public servents. Art.16 2- Regulation 925/95 was refered to Registars as collaborators 3- Concurrence of multiple subjects under obligation

C.R.A.B. : LAND REGISTRY ANTIMONEY LAUNDRING AND TERRORISM FINANCING OFFICE Law 10/2010 28 April: art.2 Subjects under obligation : Notaries and land , business and movable property Registars art.27 Centralized preventive bodies. Created by ministerial order Voluntary assignment except for Notaries and Registars CRAB is the centralized body of land , business and movable property Registars. Its function is to promote and collaboration between Registars and legal authorities, police and public servers to prevent money laundering and terrorist financing It controls Registries in this matter Total technical autonomy

Internal Evaluation Unit Verification of sanction list (E.U.) GOBERMENT BOARD PREVENT MONEY LAUNDERING COMISSION C.R.A.B. DIRECTOR GOBERMENT BOARD Internal Evaluation Unit Analyse Unit Unidad de Análisis Verification of sanction list (E.U.) Alalyse

COLLABORATION WITH AUTHORITIES IN PREVENTING AND ERRADICATING MONEY LAUNDRING 1- Businesses linked with money laundering and terrorist financing 2- It requires to be request, by the solicitor or authority 3- Information required: i- Current entitlements of natural or artificial person ii- Business positions of natural or artificial person iii- Inscriptions copies iv- Annual accounts copies

Internal Control Body

INTERNAL CONTROL BODY I 1- Follows procedures, rollout and problems in preventing money laundering, taking measures and developing internal rules in order to improve the system. 2- It decides which suspicious transactions must be communicated to the Executive service 3- To inform Registars on type of risk transactions 4- To adopt measures in order to garantie confidenciality 5- Definition of policies to adopt, and formulation of the rules for Registars in other to coordinate them

INTERNAL CONTROL BODY II 1-To analyse and evaluate money laundering evidences 2- To report and take de necessary corrective measures of the land and business Registry data base 3- To elaborate a yearly plan 4- To draft an annual report, with the relevant events about money laundering, and terrorism financing

INTERNAL CONTROL BODY III 1- To evaluate risks of Registars activity depending on geographic location, intervening parties and transactions 2- To check European lists of frozen assets 3- To give information to an external expert from the OCP 4- Control procedures of internal control by the Registars

Collaboration SEPLAC

COLLABORATION WITH SEPLAC 1- To exam and evaluate suspicious transaction 2- To centralize communications in terms of money laundering, and terrorism financing 3- To meet the requirements set by SEPLAC and legal authorities 4- TO OBTEIN INFORMATION ABOUT THE REAL BENEFICIAL OWNER, coming from suspicious transactions if it is not known