Financial Crime World

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Compliance Checklist for Financial Institutions in Jordan: Navigating the Anti-Money Laundering and Counter-Terrorist Financing Law

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The Anti-Money Laundering and Counter-Terrorist Financing Law No. 20 of 2021 (the “AML/CFT Law”) came into effect on September 16, 2021, replacing its predecessor, the Anti-Money Laundering and Counter-Terrorist Financing Law No. 46 of 2007 and its Amendments. The AML/CFT Law introduces a more comprehensive framework for anti-money laundering (AML) and countering terrorist financing (CFT), with enhanced regulatory safeguards in line with global standards.

Overview

This article provides an overview of the AML/CFT Law, focusing on general regulations surrounding AML/CFT and notification obligations applicable to entities falling under its scope.

Definition of Money Laundering and Terrorist Financing

Under the AML/CFT Law, money laundering is defined as any activity that involves the transfer, transport, concealment, or misrepresentation of proceeds from criminal activities. The law also extends to anyone who assists, influences, facilitates, or conceals such crimes.

Similarly, terrorist financing is considered any activity that directly or indirectly provides funds for the purpose of committing acts of terrorism. The law includes a broader scope of activities, including providing financial support to individuals or groups involved in terrorism.

Notification Obligations

The AML/CFT Law places notification obligations on certain entities, including:

  • Lawyers
  • Legal practitioners
  • Legal accountants who arrange and perform financial operations on behalf of other persons and/or entities

These entities must submit reports to the Anti-Money Laundering and Counter-Terrorist Financing Unit (Unit) on a regular basis.

Confidentiality and Disclosure

The law also prohibits disclosure of any reports submitted to the Unit, except in cases where disclosure is necessary for commercial or legal purposes. Additionally, authorities such as:

  • Central Bank of Jordan
  • Jordanian Securities Commission
  • Others

are obligated to undertake procedures to capture financial crime and report it to the Unit.

Conclusion

In conclusion, the AML/CFT Law builds upon and improves the existing framework, enhancing scrutiny, monitoring, and capturing of money laundering and terrorist financing activity in Jordan. Financial institutions should take note of these developments and ensure compliance with the new regulations.

Contact Us

For further information or advice on financial agreements and transactions, please contact:

at Al Tamimi & Company’s Banking and Finance team.