Financial Crime World

Iraq Cracks Down on Financial Institution Compliance with AML/CTF Certifications

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Combating Money Laundering and Terrorist Financing in Iraq

The Iraqi government has taken significant steps to combat money laundering and terrorist financing through the establishment of the Anti-Money Laundering and Terrorist Financing Office within the Central Bank of Iraq.

Requirements for Financial Institutions

According to the Anti-Money Laundering and Terrorist Financing Law No. (39), financial institutions in Iraq are required to obtain AML/CTF certifications. This involves performing a range of duties, including:

  • Receiving and analyzing reports of suspicious transactions
  • Suspending transactions that may be related to money laundering or terrorist financing
  • Transmitting information to the relevant authorities

The Office of Combating Money Laundering and Terrorist Financing

The Office of Combating Money Laundering and Terrorist Financing (Money Laundering Reporting Office) was established in 2007 and reconfigured in 2015 to oversee compliance with AML/CTF regulations. The office is responsible for:

  • Analyzing data
  • Communicating with financial institutions to ensure compliance with the law

Compliance Program Requirements

Designated non-financial businesses and professions, as well as financial institutions, must establish a compliance program to demonstrate their commitment to preventing money laundering and terrorist financing. This includes:

  • Coordinating with government agencies
  • Participating in international conferences
  • Creating a national database for analyzing data
  • Providing training for employees

Enhancing Capacity to Detect and Prevent Money Laundering and Terrorist Financing

The Iraqi government is working to enhance its capacity to detect and prevent money laundering and terrorist financing by:

  • Exchanging information with other countries and international organizations
  • Improving data analysis and sharing techniques

Penalties for Non-Compliance

The government has introduced penalties for financial institutions that fail to comply with AML/CTF regulations, including:

  • Notification of regulatory authorities
  • Technical support for agreements and treaties relating to money laundering and terrorist financing

Expected Outcomes

The implementation of these measures is expected to significantly improve Iraq’s ability to combat money laundering and terrorist financing, and protect its financial system from being exploited by criminals.