Financial Crime World

Understanding the ML/TF Act: A Comprehensive Guide

Introduction

The ML/TF Act is a critical piece of legislation aimed at combating money laundering and terrorist financing. In this article, we will delve into the key aspects of the Act, including secrecy requirements for authorities, the role of the Financial Intelligence Processing Unit (CTIF-CFI), sanctions for non-compliance, restrictions on cash payments and donations, and monitoring compliance.

Secrecy Requirements

  • Members of CTIF-CFI, the police, and external experts are bound by professional secrecy (art. 83) and may not disclose information they have received while performing their duties, except in certain exceptions.
    • Exceptions: Not specified in the provided text.

Role of the Financial Intelligence Processing Unit (CTIF-CFI)

  • The main role of CTIF-CFI is to analyze the information it receives and forward serious indications of money laundering or terrorist financing to the Public Prosecutor or the Federal Public Prosecutor.
  • CTIF-CFI may also oppose, for a period of 5 days, the execution of a transaction when it suspects it is related to money laundering or terrorist financing.

Sanctions for Non-Compliance

  • Administrative Fines: Ranging from 250 to 1,250,000 euros for non-financial professions and 5,000 to 10% of the annual net turnover for financial professions.
  • Restriction on Cash Payments: Sanctions consist of a criminal fine ranging from 2,000 to 1,800,000 euros (including legal surcharges) for non-compliance.

Restrictions on Cash Payments and Donations

  • Cash Payments above 3,000 euros may not be made in cash.
  • Certain types of transactions, such as selling real estate or purchasing precious metals, may only be done by bank transfer or cheque.
  • The purchase of precious metals, old metals, or copper cables by a professional from a consumer is restricted.

Monitoring Compliance

  • FPS Economy: Monitors compliance with the restriction on payments and donations in cash.
  • Other supervisory authorities: Monitor compliance with the Act for specific sectors or aspects. These authorities may request information and conduct on-site inspections as necessary.