Albania Tightens Grip on Anti-Money Laundering Regulations
The Albanian Parliament has adopted a new law aimed at strengthening the country’s anti-money laundering (AML) regulations, aligning them with European Union standards. The law comes into effect on January 5th, 2022.
Amendments to AML Law
The amendments to the Law no. 9917, dated May 19, 2008 on Prevention of Money Laundering and Financing of Terrorism aim to address recommendations from the Financial Action Task Force and the findings of Moneyval for Albania. The new law introduces several significant changes to the AML regime in Albania.
Key Changes
- Expanded Definition of “Politically Exposed Persons”: Middle-ranking management or junior-ranking officials who are not obliged to make asset declarations under existing legislation will now be considered as politically exposed persons.
- Definition of Beneficial Owner: The law introduces a new definition of beneficial owner, referring to the Law on Register of Beneficial Owners. This change aims to improve transparency and prevent money laundering.
- Obliged Entities: Certain professionals, including lawyers, notaries, and auditors, are now categorized as obliged entities under the AML Law. These individuals will be required to conduct customer due diligence measures to prevent money laundering and terrorist financing.
Additional Changes
- Conducting Business Relationships without Physical Presence: Obliged entities can establish business relationships without the physical presence of clients, provided that a combined risk assessment indicates a low risk of money laundering or terrorism financing.
- Enhanced Customer Due Diligence Measures: Transactions involving high-risk countries will require enhanced customer due diligence measures, in line with EU regulations aimed at combating money laundering and terrorist financing.
Penalties for AML Breaches
The new law introduces more severe penalties for serious breaches of the AML regime. Obliged entities that commit:
- Serious, repetitive, or systematic contraventions could face fines equivalent to up to two times the amount gained from the breach, or a maximum of ALL 125,000,000 in cases where the gain cannot be determined.
- Up to 10 percent of annual turnover for banks, non-banking financial institutions, and exchange bureaus that commit AML breaches.
Conclusion
The changes are expected to strengthen Albania’s AML regime and bring it in line with international standards. KPMG advises clients on all aspects of AML compliance and remains available to provide further guidance or assistance as needed.