Georgia Takes a Stand Against Money Laundering and Terrorist Financing
Tbilisi, Georgia - In a move to combat the global threat of money laundering and terrorist financing, Georgia has implemented enhanced due diligence measures for high-risk customers, including politically exposed persons.
Thorough Customer Due Diligence Procedures
According to sources, the country’s financial institutions are now required to conduct thorough customer due diligence procedures, verifying the identity and purpose of transactions to prevent illegal activities. This comes as a response to increasing concerns over the use of Georgia’s financial system by criminal organizations and terrorist groups.
Penalties for Non-Compliance
The National Bank of Georgia (NBG) and Financial Monitoring Service of Georgia (FMS) have issued strict penalties for non-compliance with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations. These penalties include:
- Administrative fines ranging from GEL 5,000 to GEL 50,000
- Suspension or revocation of licenses for financial institutions
- Criminal charges with imprisonment up to ten years for individuals and hefty fines for institutions
- Freezing of assets suspected of being linked to money laundering activities
- Prohibition on conducting certain transactions
Industry-Specific Regulations
Georgia has also implemented industry-specific AML/KYC regulations for sectors such as real estate and legal services. Real estate agents, brokers, and intermediaries are required to conduct customer due diligence measures, including identifying the customer and verifying their identity.
Lawyers in Georgia are also subject to AML/KYC regulations, which require them to identify clients and verify their identities before providing services. They are also obligated to report any suspicious transactions to the Financial Monitoring Service of Georgia.
Balancing AML/KYC with Privacy Considerations
Georgia has implemented measures to balance its AML/KYC regulations with privacy considerations for individuals. The country’s data protection laws strictly regulate how personal data is collected, used, and disclosed by both public and private entities.
Financial institutions are required to collect and verify customer information before conducting any transactions, while also ensuring that personal data is processed lawfully and fairly. Exemptions have been made for information disclosure based on legitimate interests or when required by law enforcement agencies.
Georgia’s Commitment to Combating Money Laundering
Georgia’s commitment to combating money laundering and terrorist financing has earned recognition from international bodies. The country has demonstrated a strong willingness to collaborate with federal authorities and international organizations in tackling this global issue.
As the global financial landscape continues to evolve, Georgia remains committed to staying ahead of the curve in preventing illegal activities. Its robust AML/KYC framework serves as a model for other countries, demonstrating that effective regulations can be balanced with privacy considerations while ensuring the safety and security of the financial system.
For Foreign Counterparts
Georgia’s commitment to combating money laundering and terrorist financing is a testament to its dedication to international cooperation and best practices in financial regulation. As foreign counterparts, we encourage you to explore Georgia’s AML/KYC framework and learn from its experiences in balancing regulatory requirements with privacy considerations.
By sharing this information, we hope to foster greater collaboration and understanding between countries in the fight against money laundering and terrorist financing. Together, we can work towards a safer and more secure financial future for all.