Money Laundering Techniques in New Caledonia: A Complex Web of Regulations

The European Union has been at the forefront of combating money laundering and terrorist financing through its anti-money laundering directives. Since 1990, the EU has revised its regulations multiple times to mitigate risks related to money laundering and terrorist financing.

Evolution of Anti-Money Laundering Directives

• The first directive was adopted in 1990, requiring obliged entities to apply customer due diligence requirements when entering into a business relationship.
• In 2015, the EU adopted a modernized regulatory framework, including Directive (EU) 2015/849 on preventing the use of the financial system for money laundering or terrorist financing, and Regulation (EU) 2015/847 on information on the payer accompanying transfers of funds.
• The 5th Anti-Money Laundering Directive came into effect in June 2018, introducing stricter regulations for obliged entities, including insurance companies.

Regulations in New Caledonia

According to Article L.561-2 of the Monetary and Financial Code:

• Insurance companies must identify and verify the identity of their customers, as well as beneficiaries of life insurance or capitalization contracts.
• Verification includes checking the physical presence of the beneficiary during registration and ensuring they do not reside outside the EU.

Additionally:

• Insurance companies are required to report suspicious transactions to the department mentioned in Article L.561-23 of the MFC.
• Reporting is triggered when the insurance company knows, suspects or has good reason to suspect that a transaction originates from an offence punishable by a custodial sentence of more than one year or is linked to terrorist financing.

Asset Freezing Mechanism

New Caledonia has implemented its own asset freezing mechanism, as outlined in Articles L.562-1 and following of the MFC:

• This mechanism allows for the freezing of assets suspected of being connected to money laundering or terrorist financing.

Comparison with French Polynesia

While French Polynesia shares similar regulations with New Caledonia, there are some key differences:

• Article L.755-13 of the MFC sets forth anti-money laundering regulations applicable in French Polynesia, which include:
  • Vigilance obligation
  • Reporting obligation
  • Asset freeze mechanism

Conclusion

Money laundering techniques in New Caledonia are complex and multifaceted, requiring insurance companies operating in the region to be aware of and comply with strict regulations. Failure to do so can result in severe consequences, including fines and even criminal charges. As such, it is essential for insurance companies to stay informed about these regulations and adapt their practices accordingly.