Compliance with Anti-Money Laundering and Combating the Financing of Terrorism (AML-CFT) Law

Minimum Statutory Obligations for Supervised Institutions

Supervised institutions, such as banks and financial institutions, have minimum statutory obligations under the AML-CFT Law and Decision. These obligations are designed to prevent money laundering and terrorist financing by ensuring that financial institutions have robust systems in place.

Key Obligations

• Risk Assessment: Identify, assess, and understand risks associated with money laundering and terrorist financing.
• Due Diligence Measures: Define the scope of and take necessary due diligence measures to mitigate risks.
• Compliance Officer: Appoint a compliance officer approved by the relevant supervisory authority.
• Internal Controls: Put in place adequate management and information systems, internal controls, policies, and procedures to mitigate risks and monitor implementation.
• Suspicious Transactions: Identify indicators of suspicious transactions and report them to competent authorities.
• Cooperation with Authorities: Cooperate with competent authorities in investigating suspicious activity.
• Directive Implementation: Promptly apply directives of competent authorities for implementing UN Security Council decisions under Chapter 7 of the UN Convention for the Prohibition and Suppression of the Financing of Terrorism and Proliferation (AML-CFT Law).
• Record Keeping: Maintain adequate records.

Additional Guidance

Confidentiality and Data Protection

• Financial institutions must maintain confidentiality when reporting suspicious activity to competent authorities.
• They must make reasonable efforts to protect information and data reported from unauthorized access.
• Confidentiality requirements do not pertain to communication within the institution or its affiliated group members.

Liability Protection for Reporting Persons

Financial institutions are protected against liability for reporting persons who, in good faith, report suspected money laundering or terrorist financing activity.

Statutory Prohibitions

• Financial institutions are prohibited from establishing or maintaining relationships with anonymous or fictitious customers.
• They are also prohibited from conducting transactions or keeping accounts without completing adequate risk-based customer due diligence measures.

Conclusion

These obligations aim to prevent money laundering and terrorist financing by ensuring that financial institutions have robust systems in place to identify, report, and mitigate suspicious activity. By complying with these minimum statutory obligations, supervised institutions can help maintain the integrity of the financial system and protect against illicit activities.