Iceland Tightens Grip on Anti-Terrorism Financing Regulations to Combat Illicit Activities

To prevent money laundering and terrorist financing, Iceland has introduced stringent regulations to curb illegal activities in its financial system. The country’s Central Bank is responsible for supervising entities required to comply with these new laws, which came into effect through Act no. 140/2018.

New Legislation Requirements

The legislation requires parties engaging in activities susceptible to money laundering or terrorist financing to:

• Verify customer identities
• Monitor transactions
• Notify authorities if they suspect or have knowledge of illegal activities taking place within their operations

Central Bank’s Authority and Penalties

The Central Bank of Iceland has been granted the authority to impose penalties on non-compliant parties, including:

• Administrative fines
• Dismissal of board members and managing directors
• Revocation of operating licenses
• Application of sanctions

This move is expected to discourage criminals from exploiting Iceland’s financial system.

Money Laundering and Terrorist Financing Concerns

Money laundering is a significant concern for Iceland, as it enables organized crime to thrive and undermines the country’s economic stability. The financing of terrorism also poses a significant threat, as terrorist groups rely on illicit funding to carry out their nefarious activities.

Iceland’s Proactive Approach

Iceland’s new regulations aim to prevent these illegal activities by ensuring that obliged entities have robust supervision systems in place. This proactive approach is expected to safeguard the country’s financial system and protect its citizens from the negative consequences of money laundering and terrorist financing.