Financial Crime World

ALBANIA INTENSIFIES AML/KYC REGULATIONS: WHAT BANKS AND FINANCIAL INSTITUTIONS NEED TO KNOW

Strengthened Anti-Money Laundering (AML) and Know Your Customer (KYC) Regulations in Albania

TIRANA, ALBANIA - The Albanian government has recently enhanced its anti-money laundering (AML) and know your customer (KYC) regulations. This mandates financial institutions to verify the identity of customers and assess potential risks in business relationships.

Key Requirements for Financial Institutions

According to the AML Law in Albania, which was amended in 2019, financial institutions must:

  • Collect identification data from new customers, including:
    • Name
    • Date of incorporation
    • Form of entity
    • Scope of activity
    • Taxpayer identification number
    • Personal data
  • Identify ultimate beneficiaries
  • Gather transactional data, such as:
    • Business relationships
    • Transaction values
    • Currencies
    • Execution dates

Due Diligence Situations

The regulations prescribe that due diligence is required in the following situations:

  • Before establishing a business relationship
  • When customers carry out or intend to carry out transactions exceeding 100,000 Albanian Lek (approximately $900 USD) for certain entities, such as those providing transfer services, foreign exchange, or gaming services
  • For transactions valued at not less than 1 million Albanian Lek (approximately $9,000 USD), executed in a single transaction or linked transactions
  • When there are doubts about the veracity of previously obtained identification data
  • In cases where there are suspicions of money laundering or terrorism financing

Implementing Due Diligence Measures

Financial institutions must also implement due diligence measures to identify and assess potential risks in business relationships. The regulations allow for:

  • Physical presence
  • Face-to-face identification
  • Submission of passports or ID documents

While it is possible for financial institutions to engage professional advisors, such as notaries, attorneys, or financial consultants, to outsource certain components of the due diligence process, liability and responsibility remain with the bank or financial institution.

Conclusion

Albania’s AML/KYC regulations aim to prevent money laundering and terrorism financing by ensuring that financial institutions verify customer identities and assess potential risks in business relationships. Financial institutions must comply with these regulations to maintain a strong anti-money laundering framework and avoid potential legal and reputational consequences.