Financial Crime World

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Turkey Cracks Down on Money Laundering: Understanding AML/CTF Regulations

The Turkish Financial Crimes Investigation Board (MASAK), a financial intelligence agency under the Ministry of Finance and Treasury, has been at the forefront of efforts to prevent money laundering in Turkey. As part of this effort, MASAK requires financial institutions and other designated parties to implement robust Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CTF) compliance programs.

Complying with AML/CTF Regulations

To ensure compliance with international standards, Turkish financial institutions must adhere to a set of requirements, including:

  • Onboarding principles
  • Due diligence for customers
  • Suspicious transaction reporting procedures
  • Documentation principles
  • Independent audits
  • Notification to the Customs administration

Designated parties are also required to perform due diligence on customers, disclose suspected money laundering or terrorism financing transactions to MASAK, and maintain and provide relevant information and records upon request.

Reporting Suspicious Transactions

MASAK requires financial institutions to report any suspicious transactions, regardless of value, to its authorities within a specified timeframe. The term “transaction” can refer to multiple transactions, and multiple suspicious transactions must be reported on a single Suspicious Transaction Report (STR) form.

  • Any information, suspicion, or reasonable ground to suspect money laundering or terrorism financing is sufficient grounds for reporting.
  • The compliance officer appointed by the Board of Directors is responsible for reporting suspicious transactions, which must be done within ten working days of suspicion arising, unless immediate reporting is necessary due to circumstances that would cause a delay.

Internal reports and information about transactions and customers related to STRs must remain confidential, with violators facing imprisonment and fines.

MASAK: The Watchdog

As Turkey’s AML/CTF supervisor, MASAK plays a crucial role in the country’s efforts to combat money laundering and terrorism financing. By providing guidance on compliance requirements and conducting investigations and audits, MASAK helps ensure that Turkey’s financial system is safe from illicit activities.

Conclusion

Understanding AML/CTF regulations in Turkey is essential for financial institutions and designated parties seeking to comply with international standards and avoid penalties. By following MASAK’s guidelines and reporting suspicious transactions promptly and correctly, these entities can play a vital role in preventing money laundering and terrorism financing in Turkey.