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Guidance

The prevention of money laundering and combating the financing of terrorism

Guidance for remote and non-remote casinos: fifth edition

  1. Contents
  2. Part 8 - Suspicious activities and reporting
  3. 3 - What is meant by reasonable grounds to know or suspect?

3 - What is meant by reasonable grounds to know or suspect?

In addition to establishing a criminal offence relating to failing to report when there is suspicion or actual knowledge of money laundering, POCA creates criminal liability for failing to disclose information when reasonable grounds exist for knowing or suspecting that a person is engaged in money laundering or terrorist financing.

This lower test, which introduces an objective test of suspicion, applies to all businesses covered by the Regulations, including remote and non-remote casinos. The test would likely be met when there are demonstrated to be facts or circumstances, known to the employee in the course of business, from which a reasonable person engaged in a casino business would have inferred knowledge, or formed a suspicion, that another person was engaged in money laundering or terrorist financing.

To defend themselves against a charge that they failed to make a report when the objective test of suspicion has been satisfied, employees within remote and non-remote casinos would need to be able to demonstrate that they took reasonable steps in the particular circumstances (and in the context of a risk-based approach) to conduct the appropriate level of CDD.

It is important to bear in mind that, in practice, a court will be deciding, with the benefit of hindsight, whether the objective test was met.

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What is meant by knowledge and suspicion?
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What constitutes suspicious activity?
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