Argentina Implements Strict Know Your Customer (KYC) Procedures

Understanding Argentina’s Fight Against Money Laundering and Terrorism Financing

In a bid to prevent and combat money laundering, terrorism financing, and complex economic-financial crimes, Argentina’s Financial Information Unit (UIF) has established stringent Know Your Customer (KYC) procedures for all designated service providers operating in the country.

The Role of the UIF

The UIF is a financially autonomous organization responsible for collecting, processing, and distributing data to prevent and combat money laundering, terrorism financing, and complex economic-financial crimes. The FIU’s primary functions are surveillance, identification, and investigation.

Complying with AML/CFT Regulations in Argentina

To comply with AML/CFT regulations in Argentina, all designated service providers must maintain an anti-money laundering/counter-terrorism financing (AML/CFT) program that is tailored to their specific needs. The program must be risk-based, demonstrating a clear connection between recognized risks and the processes, rules, and controls that address those risks.

Key Obligations for Designated Service Providers

All obligated entities in Argentina are required to adhere to the following obligations:

• Customer Due Diligence: Collect documentation from customers to establish their identity, legal status, address, and any other information necessary to carry out the planned activity.
• Reporting Suspicious Transactions: Report any suspicious transactions or activities, regardless of their size, to the UIF.
• Confidentiality: Refrain from disclosing to clients or other parties the AML/CFT activities being carried out in accordance with the legislation.
• Risk Assessment: Conduct a risk assessment to determine the likelihood of a company being a victim of money laundering.
• Know Your Customer (KYC): Maintain accurate records to understand the customer’s profile.
• Monitoring: Create a framework to monitor and manage client transactions to identify anomalous and suspicious behavior that fits the specified profile.
• Investigation: Ensure all employees understand the importance of adhering to the organization’s policies and procedures relating to the prevention of money laundering and terrorism financing.
• Reporting: The entity’s systems must be capable of collecting information necessary to meet regulatory obligations for reporting to different authorities while preserving the integrity of the information.
• Audit: Conduct a risk-based internal audit plan to demonstrate compliance with the AML/CFT policy.

Reviewing and Auditing Your AML/CFT Program

To ensure ongoing compliance, all designated service providers must:

1. Systematic Monthly Reporting: Submit systematic monthly reports to the UIF.
2. Suspicious Operations Reports: Report any irregular operations suspected of money laundering or terrorism financing to the UIF.
3. Confidentiality: Treat suspicious transaction reports with confidentiality.
4. Reporting Timeframe: The maximum reporting time for unlawful actions or money laundering is 150 calendar days, while reports involving the financing of terrorism must be submitted within 48 hours.

Argentina’s stringent KYC procedures are designed to prevent and combat money laundering and terrorism financing by ensuring that all designated service providers maintain robust AML/CFT programs.