Financial Crimes on the Rise: Jordan Enacts Tougher Anti-Money Laundering and Counter Terrorist Financing Law

Strengthening Regulatory Framework to Combat Financial Crimes

Amman, Jordan - In a bid to combat financial crimes, Jordan has enacted a revised anti-money laundering (AML) and counter terrorist financing (CFT) law. The new legislation, effective since September 16, 2021, aims to strengthen the country’s regulatory framework in combating money laundering and terrorist financing.

Key Changes and Definitions

The AML/CFT Law introduces significant changes to the previous legislation, providing for a more comprehensive scope of financial crimes and increased oversight by regulatory authorities. The law defines money laundering as any act that:

• Conceals or misrepresents the source, nature, location, disposal, transaction record, property in, or rights attached to proceeds of criminal activities.
• Directly or indirectly provides funds, whether from a legitimate source or not, with the knowledge that such funds will be used to commit an act of terror.

Expanded Definition of Terrorist Financing

The law also expands the definition of terrorist financing, which includes:

• Any act that directly or indirectly provides funds, whether from a legitimate source or not, with the knowledge that such funds will be used to commit an act of terror.
• The crime of financing terrorism may be committed even if the act of terror is not actually carried out.

New Notification Obligations

The law introduces new notification obligations for entities subject to AML/CFT regulations, including:

• Lawyers, legal practitioners, and legal accountants arranging and/or performing financial operations on behalf of other persons and/or entities.
• Entities are required to notify regulatory authorities of any suspicious transactions or activities.

Increased Powers for Authorities

The authorities have been granted increased powers to monitor and report suspicious transactions. The law obliges regulatory bodies, including the Central Bank of Jordan, the Jordanian Securities Commission, and others to:

• Conduct field and office inspections
• Communicate with foreign authorities
• Retain reports and statistics related to AML/CFT activities

Expert Analysis

Experts believe that the new law will help to enhance Jordan’s reputation as a safe haven for financial transactions and strengthen its efforts in combating money laundering and terrorist financing. The law is expected to have far-reaching implications for financial institutions, lawyers, and other entities subject to AML/CFT regulations.

Contact Us for More Information

For more information on how this law may affect your business or financial transactions, please contact:

• Dana Abduljaleel (D.Abduljaleel@tamimi.com)
• Hakam Al Shawwa (H.AlShawwa@Tamimi.com)

At Al Tamimi & Company’s Banking and Finance team.