AML Guidelines for Small Businesses in Iraq

Introduction

Money laundering is a significant threat to both national and global economies, with financial institutions being the most targeted organizations by money launderers and terrorist groups. To combat this menace, the Iraqi government has implemented the Anti-Money Laundering (AML) Law.

The Central Bank of Iraq’s Anti-Money Laundering Office

The Central Bank of Iraq’s Anti-Money Laundering Office is responsible for issuing directives and policies to certified banks, money transfer companies, and money exchange businesses. The office receives reports related to money laundering issues and has the authority to take necessary steps.

Duties of the Money Laundering Reporting Office

• Collecting, treating, analyzing, and publishing testimonials related to financial transactions
• Participating in carrying out the Iraqi policy to prohibit money laundering and criminal activities, including terrorism financing
• Cooperating with Iraqi governmental authorities and relevant entities of other states and international organizations to fight money laundering and criminal activities

Obligations of Financial Institutions

Verification of Client’s Identity

When opening an account or conducting a transaction valued at over five million Iraqi Dinars, financial institutions must obtain the client’s:

• Legal name
• Permanent address
• Identification

Additional Verification of Identity

If there is reason to doubt the client’s identity, financial institutions must take additional steps to verify it.

Verification of Purpose and Nature of Transaction

Financial institutions must immediately verify the source of funds, nature, and intended purpose of transactions.

Reporting Requirements

Suspicious Transactions over 2 million Dinars

Financial institutions must report any suspicious transaction exceeding two million Iraqi Dinars to the Money Laundering Reporting Office within fourteen days.

Reports of Fund Transactions over 15 million Dinars

Every financial institution must organize a report for the Money Laundering Reporting Office for every deposit, withdrawal, currency exchange, or other transfer that deals with fund transactions exceeding fifteen million Iraqi Dinars.

Reports of Currency Transfers over 15 million Dinars

The Iraqi Central Bank requires reports related to the transfer of currency or monetary means valued at over fifteen million Iraqi Dinars from or to Iraq.

Conclusion

Money laundering activities pose a significant threat to national and global economies, and it is crucial that financial institutions comply with the AML Law’s provisions to reduce the effects of organized crime on the Iraqi economy and the global economy. The Iraqi government’s efforts to combat money laundering are commendable, and we will continue to monitor compliance with these guidelines.