Financial Crime World

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Iceland Takes a Stand Against Financial Crimes: A Look at Money Laundering and Terrorist Financing Definitions

Iceland takes financial crimes very seriously, implementing strict measures to prevent money laundering and terrorist financing, which can have devastating impacts on society’s financial system and hinder free competition.

Definition of Money Laundering

According to Act no. 140/2018 on measures against Money Laundering and Terrorist Financing, money laundering is defined as:

  • Any kind of receipt, handling or transfer of gains obtained by illicit means
  • Violation of the Penal Code or special laws

This definition is a key prerequisite for organized crime to thrive within society and across borders.

Definition of Terrorist Financing

Terrorist financing is also a serious concern in Iceland. The country has taken steps to prevent:

  • Raising funds for the purpose or with the knowledge that the money is to be used to commit crimes punishable under Article 100 (a-c) of the General Penal Code, such as:
    • Committing terrorism
    • Supporting parties who commit such acts
    • Encouraging them

Supervision and Penalties

The Central Bank of Iceland plays a crucial role in supervising parties engaging in activities that could be used for money laundering or terrorist financing. The bank has the authority to impose penalties if it becomes apparent that the provisions of the Act or regulations on the basis thereof are not enforced, including:

  • Administrative fines
  • Dismissal of the board and managing director
  • Revocation of operating licenses
  • Application of sanctions

Importance of Reliable Supervision

It is vital for the state to have reliable and visible supervision and ensure that obliged entities have an appropriate supervision system in their operations. This discourages criminals from preying on Iceland’s financial system.

With a strong anti-money laundering and terrorist financing regime in place, Iceland is sending a clear message: it will not tolerate such illegal activities and will work tirelessly to protect its citizens and economy.