Financial Crime World

Establishing Public Confidence in Republic’s Financial System: Definitions Take Center Stage

March 10, 2023

In an effort to strengthen the financial system of the Republic and prevent illicit activities, the government has introduced a new act that outlines key definitions. The legislation aims to promote transparency and accountability in financial transactions, ultimately boosting public confidence in the sector.

Clarifying Key Definitions

The “Definitions” section of the Act clarifies several terms, including:

  • Account: Any facility or arrangement where a reporting entity takes custody of or accepts deposits of property on behalf of customers. This includes bearer negotiable instruments, closed accounts, inactive or dormant accounts, and even accounts with no balance.
  • Activity: Acts or omissions made by individuals, including those related to Anti-Money Laundering and Combatting the Financing of Terrorism and other financial crime (AML/CTF).
  • Anti-Money Laundering and Combatting the Financing of Terrorism (AML/CFT): Measures aimed at preventing the misuse of financial systems for criminal activities.

Additional Definitions

Other key definitions introduced in the Act include:

  • Beneficial owner: The same meaning as defined under the Beneficial Ownership Act 2017.
  • Business relationship: A professional or commercial connection with a customer that is expected to have an element of duration.
  • Cash: Currency in physical form.

Clarifying Criminal Conduct

The government has also clarified the concept of criminal conduct, which includes:

  • Offenses such as money laundering, terrorist financing, and other financial crimes.
  • Non-payment or evasion of taxes, duties, or statutory levies.
  • Insider trading and market manipulation.

Defining Criminal Property

Finally, the Act defines criminal property as any property that is derived from, obtained, used, or intended to be used in connection with criminal conduct. This includes:

  • Interests in such property, dividends, income, or value generated by it.
  • Property that was converted, transformed, or intermingled from criminal proceeds.

Promoting Public Confidence

The new Act aims to ensure that financial institutions and other reporting entities have a clear understanding of their obligations and responsibilities under the AML/CFT regime. By providing these definitions, the government hopes to promote public confidence in the financial system and prevent illicit activities that can undermine trust and stability.

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“The introduction of these definitions is an important step towards establishing a robust and transparent financial system in our Republic,” said [Name], Minister of Finance. “We are committed to ensuring that our financial institutions operate with integrity and that public confidence is maintained.”