Strengthening Anti-Money Laundering and Counter-Terrorism Financing in Georgia
New Regulations Introduced to Prevent Suspicious Transactions
The Georgian government has taken a significant step towards strengthening its anti-money laundering and counter-terrorism financing (AML/CFT) regime by introducing new regulations aimed at preventing suspicious transactions exceeding 30,000 GEL (approximately $10,500 USD).
Key Provisions of the New Law
- Article 12 requires financial institutions to implement preventive measures before establishing a business relationship with a client or conducting a single transaction.
- Verifying the identity of the client and beneficial owner
- Checking for any changes in circumstances related to the client
- Prohibition on opening or holding anonymous or fictitious accounts
- Enhanced due diligence procedures for transactions exceeding 30,000 GEL
Beneficial Owner Definition and Identification
- Article 13 defines a beneficial owner as:
- A natural person who is the last possessor or controller of a client
- One who prepares, makes, or completes a transaction on behalf of another person
- Rules for identifying beneficial owners of legal persons, including those with indirect control over a legal entity
Preventive Measures for Uncertainty about Beneficial Ownership
- In cases where an accountable person is unsure about the existence of a beneficial owner, they must implement preventive measures determined by Article 10(1)(b) of the law.
- Individuals with managerial authority over a client or those exercising effective ultimate control over a trust or similar legal structure
Enhancing Georgia’s AML/CFT Regime
The new regulations aim to enhance Georgia’s AML/CFT regime and ensure that financial institutions comply with international standards for preventing money laundering and terrorist financing. By introducing these measures, the Georgian government is demonstrating its commitment to combating financial crimes and maintaining a stable and secure economic environment.