Financial Crime World

Jordan’s CFT Rules for Financial Transactions: A Comprehensive Overview

The Jordanian government has enacted a new law to combat money laundering and terrorist financing, introducing stricter regulations on financial transactions in the country. The Anti-Money Laundering and Counter Terrorist Financing Law No. 20 of 2021 (the “AML/CFT Law”) repeals and replaces its predecessor, the Anti-Money Laundering and Counter Terrorist Financing Law No. 46 of 2007.

Definition of Money Laundering

Under the AML/CFT Law, money laundering is defined as any person who knowingly:

  • Transfers or transports funds with knowledge that they are proceeds of criminal activities
  • Conceals or misrepresents the source, nature, or location of such funds
  • Earns, uses, manages, invests, or possesses such funds

Definition of Terrorist Financing

The AML/CFT Law also defines terrorist financing as any person who knowingly:

  • Provides or collects funds to support terrorism
  • Contributes to or aids in committing acts of terror
  • Finances travel for persons to commit acts of terror
  • Conceals the source of funds used to finance terrorism

Obligations of Entities

Under the new law, entities falling under its ambit are required to:

  • Notify authorities of suspicious transactions
  • Comply with AML/CFT obligations, which have been revised to exclude insurance companies and limit the scope of activities covered
  • Prohibit disclosure of reports submitted to the AML/CFT Unit, except in certain circumstances

Procedures for Capturing Financial Crime

The AML/CFT Law obliges authorities to undertake a range of procedures to capture financial crime and report it to the Unit, including:

  • Field and office inspections
  • Communication with foreign authorities
  • Retention of reports and statistics

Conclusion

In conclusion, the AML/CFT Law introduces stricter regulations on financial transactions in Jordan, aiming to combat money laundering and terrorist financing more effectively. The law builds on previous frameworks, improving and detailing them for better scrutiny, monitoring, and capturing of financial crime activity.

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