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Suspicion of Money Laundering or Terrorism Financing in Financial Institutions

Iraq’s Central Bank has introduced a new set of regulations aimed at combating money laundering and terrorism financing. The regulations, which came into effect on [date], require financial institutions to conduct enhanced due diligence on customers and maintain detailed records of transactions.

Reporting Suspicious Transactions

According to Article 5 of the regulation, if a financial institution or designated non-financial business and profession (DNFBP) suspects that a customer is involved in money laundering or terrorism financing, it must report the transaction to the Office immediately. The report must include all relevant information and documentation, including:

  • Identification documents
  • Account files
  • Business correspondence

Record Keeping and Retention

The regulations also require financial institutions to maintain records of transactions for five years after the business relationship with the customer has ended, whichever is longer. These records must be available to competent authorities in a timely manner.

Implementing Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) Programs

Article 12 of the regulation outlines the obligations of financial institutions and DNFBPs in implementing AML/CFT programs, including:

  • Conducting risk assessments and identifying potential risks
  • Establishing policies, procedures, and internal controls to mitigate those risks
  • Providing ongoing training for employees on AML/CFT
  • Implementing independent audits to assess the effectiveness of AML/CFT measures

Other Obligations

The regulations also require financial institutions to:

  • Refrain from opening or maintaining anonymous accounts or accounts under fictitious names
  • Abide by lists of barred persons and entities designated by local and international authorities

Terrorist Funds Freezing Committee

Article 15 establishes a Terrorist Funds Freezing Committee at the Secretariat of the Bank, which will be responsible for freezing the funds of terrorists or other assets of persons designated by the UN Sanctions Committee. The committee will be composed of representatives from various government ministries and agencies, including:

  • Ministry of Finance
  • Ministry of Interior
  • Commission of Integrity

The Chairman of the committee will be the Deputy Governor of the Central Bank.

Conclusion

These regulations are aimed at strengthening Iraq’s efforts to combat money laundering and terrorism financing, and ensuring that financial institutions play a key role in preventing these illicit activities.

Related News

  • Financial institutions in Iraq face new regulations to combat money laundering and terrorism financing
  • Iraqi authorities launch new initiative to track terrorist funds
  • Central Bank of Iraq introduces stricter anti-money laundering measures