Financial Crime World

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Jordan Enhances AML/CTF Regulations to Combat Financial Crime

Amman, Jordan - The Hashemite Kingdom of Jordan has recently strengthened its anti-money laundering and counter-terrorist financing (AML/CTF) regulations through the introduction of a revised law, effective September 16, 2021. The new legislation aims to enhance the country’s ability to combat financial crime and prevent the misuse of its financial system.

New AML/CTF Law No. 20 of 2021

Under the new AML/CTF Law No. 20 of 2021, Jordan has expanded its definition of money laundering and terrorist financing to include a broader range of activities. The law also imposes stricter notification obligations on entities subject to its scope, including:

  • Lawyers
  • Legal practitioners
  • Legal accountants arranging and/or performing financial operations on behalf of other persons or entities

Definitions

The AML/CTF Law defines money laundering as the act of concealing or misrepresenting the true nature, source, location, disposal mechanism, transaction record, property in, or any other rights attached to proceeds of criminal activities. Similarly, terrorist financing is defined as the act of providing or collecting funds with the knowledge that they will be used to commit an act of terror.

Scope and Penalties

The law introduces a more comprehensive scope for what constitutes money laundering and financing of terrorism, allowing for a wider application of penalties under the AML/CTF Law. This is a significant development, as it reflects a growing understanding of how financial crime operates and can be committed.

Authorities’ Roles

Under the new regulations, authorities such as:

  • Central Bank of Jordan
  • Jordanian Securities Commission
  • Ministry of Industry, Trade and Supply
  • Telecommunications Regulatory Commission

are required to undertake various procedures to capture financial crime and report it to the AML/CTF Unit. These include:

  • Field and office inspections
  • Communication with foreign authorities that supervise financial crime
  • Retention of reports and statistics on information gathered pursuant to the AML/CTF Law

Reporting Standards

The law also relaxes some reporting standards by allowing disclosure of reports to:

  • Relevant executives
  • Compliance officers
  • Intergroup disclosures between financial institutions within a single group
  • Disclosures to parties legally authorized to access such reports

This is a more considerate approach towards reporting standards, as it acknowledges that commercial and legal necessities may arise in certain circumstances.

Conclusion

The revised AML/CTF Law represents a significant step forward for Jordan in its efforts to combat financial crime. The law’s introduction of stricter notification obligations and enhanced procedures for capturing financial crime will help to increase scrutiny of financial activity and strengthen regulation of Jordanian entities.

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