What is the Financial Intelligence Unit?
Purpose and role
The purpose and role of the UK Financial Intelligence Unit (UKFIU) is to have national responsibility for receiving, analysing and disseminating financial intelligence submitted through the Suspicious Activity Reports (SARs) Regime.
SARs provide pieces of information which alert law enforcement that certain client/customer activity, for example, the cash purchase of a high-value asset or a series of large out-of-character deposits - is in some way suspicious and might indicate money laundering or terrorist financing.
Supporting UK law enforcement agencies
The UK Financial Intelligence Unit receives over 200,000 SARs a year. These are used by a wide variety of UK law enforcement bodies to help investigate all levels and types of criminal activity, from benefit fraud to international drug smuggling, and from human trafficking to terrorist financing. In many cases there will be no indication to the reporter of what the related criminal activity is as the techniques for money laundering are common across a range of crimes and a single launderer may work for many criminals or groups involved in different activities.
The most sensitive SARs and Consent SARs are identified by UKFIU staff and disseminated to their appropriate end user organisations, but the remainder are made directly searchable to UK law enforcement bodies via a secure electronic connection. In addition, the UKFIU analyses the patterns of money laundering and terrorist finance activity described within SARs to inform their own and broader UK strategies in combating these problems.
UKFIU Communications
The UKFIU produces wide-ranging and targeted communications for SARs reporters, end users and other SARs Regime stakeholders.
Key guidance documents produced by the UKFIU include ‘Completing a SAR’, ‘Introduction to SARs’, ‘Reporting via SAR Online’ and ‘SAR Training Case Studies’. These are available here
Payback Times, a quarterly newsletter produced by the Asset Recovery Working Group for the financial investigation asset recovery community, regularly features SARs-related articles provided by the UKFIU. The latest copy is available here
Products are often produced on specific subject areas and distributed to individual reporters, reporting sectors, regulators or SARs end users as required. A previous example includes the report “Protecting the Elderly and Vulnerable through the SARs Regime” which has been recently revised.
To reach out to as many participants in the SARs Regime as possible the UKFIU regularly provides communications products and presentations for events organised by regulators, trade associations, the private sector etc. Among other events, UKFIU publications have been distributed at:
- Law Society of Scotland roadshows
- The Local Government Association annual conference
- The Payback anti-money laundering conference
- A Lloyds TSB conference for global Money Laundering Reporting Officers
- An Institute of Chartered Accountants of Scotland event
- The Association of International Accountants compliance conference
Material has also been provided to the National Policing Improvement Agency (NPIA) for inclusion in their training programmes for the benefit of all law enforcement bodies.
If you would like UKFIU materials for your event, please email ukfiusars@soca.x.gsi.gov.uk
European Union regulation and international standards
A national Financial Intelligence Unit (FIU) is a requirement of EU Regulation and international standards.
The Third European Union Money Laundering Directive Article 21 stipulates that:
- Each EU Member State shall establish an FIU in order to effectively combat money laundering and terrorist financing.
- That FIU shall be established as a central national unit.
- It shall be responsible for receiving (and to the extent permitted, requesting), analysing and disseminating to the competent authorities, disclosures of information which concern potential money laundering, potential terrorist financing or are required by national legislation or regulation.
- It shall be provided with adequate resources in order to fulfil its tasks.
The Financial Action Task Force (FATF)
The FATF is an inter-governmental body, created in 1989, to develop and promote policies to counter money laundering and terrorist financing. It sets standards for national anti money laundering and counter terrorist financing programmes; evaluates the extent to which countries have implemented measures which meet those standards; and identifies and studies money laundering and terrorist financing methods and trends. FATF recommendations form an international benchmark for assessing the effectiveness of anti money laundering measures. You will find more information about FATF, its standards and typology reports at www.fatf-gafi.org.
The Financial Action Task Force (FATF) recommends that:
- Countries should establish an FIU that serves as a national centre for the receiving (and, as permitted, requesting), analysis and dissemination of Suspicious Transaction Report (STR) and other information regarding potential money laundering or terrorist financing.
- The FIU should have access, directly or indirectly, on a timely basis to the financial, administrative and law enforcement information that it requires to properly undertake its functions, including the analysis of SARs.
Membership of the Egmont Group
The UK is a member of the Egmont Group, an international forum for Financial Intelligence Units to stimulate cooperation, particularly in the areas of information exchange, training and the sharing of expertise in the fight against money laundering and financing of terrorism. There are over 100 worldwide FIUs in the Egmont Group. Membership allows the UKFIU to seek financial intelligence from other members in order to support SOCA operations and projects and to act as the conduit to this resource for the wider UK law enforcement community.