Financial Crime World

Egypt Stays Vigilant Against Money Laundering and Financial Terrorism with Know Your Customer Regulations

In its ongoing efforts to combat money laundering and financial terrorism, Egypt has implemented strict regulations on Know Your Customer (KYC) principles. This principle is a vital component in preventing fraud and ambiguity in financial transactions.

The Importance of KYC

According to the Egyptian Minister of Supply and Internal Trade Decree No. 906 of 2001, custodians are obligated to register all personal data of customers with whom they sign securities account management contracts on the database of the securities accounts management system. This includes essential facts such as:

  • National ID or customer ID number
  • Date of issue
  • Insurance number
  • Date of birth
  • Other identifying information

Required Information for KYC

The decree also outlines the required information for KYC, including:

  • Nationality
  • Religion
  • Legal form
  • Address
  • Telephone and fax numbers
  • Any other means by which a client identifies themselves

Refusing to fill out a know your customer application is considered one of the suspicious actions according to the law.

Compliance with Regulations

Furthermore, Article 13 of Decree No. 120 of 2019 regarding controls in the field of combating money laundering and terrorist financing of entities working in the field of non-bank financial activities emphasizes the importance of KYC principles. The decree prohibits any entity from failing to comply with these regulations, which is considered a serious offense.

The Egyptian Anti-Terrorism Law

The Egyptian Anti-Terrorism Law No. 94 of 2015 also plays a crucial role in defining and combating terror financing. According to Article 1, all physical and virtual assets are considered funds and assets, including:

  • Oil and other natural resources or property of any kind
  • Digital or electronic form
  • Bank credit
  • Bank checks
  • Documentary credits
  • Any interest, profits, or sources of income derived from these assets

The law also defines terror financing as any use of force, violence, threats, or intimidation at home or abroad for the purpose of disturbing public order or endangering community safety. Any action that affects funds and assets can result in a person being considered to have initiated terrorist activity.

Conclusion

The KYC principle is essential in dealing with currency and virtual assets to avoid money laundering, fraud, and financial terrorism. Egypt’s strong measures against these crimes are aimed at decreasing the occurrence of such incidents. As a result, all national and international banks must comply with these regulations to prevent fraudulent activities and maintain financial stability.