Order and Receiver of Non-Cash Transfers Must Maintain Records for Decades
FIO Requests Reporting Entities to Keep Records Longer than 10 Years, but No Timely Disclosure Obligation
The Financial Intelligence Office (FIO) has issued a new directive requiring reporting entities to maintain records of non-cash transfers and virtual asset transactions for at least 10 years. However, the entities are not obligated to provide this information in a timely manner to supervisory authorities.
Efforts to Prevent Money Laundering and Combat Financing of Terrorism (AML/CFT)
The FIO’s request comes as part of its efforts to prevent money laundering and combat financing of terrorism (AML/CFT). Reporting entities, including banks, financial institutions, and other organizations, are required to maintain detailed records of all transactions, including non-cash transfers and virtual asset transactions.
AML/CFT Law and Penalties
According to the AML/CFT Law, reporting entities must also report any suspicious activity to the FIO. The law prohibits them from disclosing information about these reports to clients or third parties, and failure to comply can result in penalties ranging from 12,000 euros to 15,000 euros for individuals and up to 40,000 euros for large traders.
Whistle-Blower Protection Law
The Whistle-Blower Protection Law was adopted in 2015 but has yet to be fully implemented. The law aims to protect individuals who report suspected money laundering or terrorist financing activity from retaliation.
AML/CFT Law and Penalties for Offenses
The AML/CFT Law also outlines strict penalties for offenses related to money laundering and terrorist financing, including imprisonment and fines. Supervisory authorities are required to propose settlement procedures and issue misdemeanor payment orders if an entity fails to comply with the law.
Internal Procedures and Training Programs
In addition to maintaining records, reporting entities must also establish internal procedures and training programs to detect and prevent money laundering and terrorist financing. This includes:
- Regular risk assessments
- Customer due diligence
- Submission of data and documentation to the FIO
International Sanctions and Corruption Fight
International sanctions are also in place to combat terrorism financing, although there are currently no sanctions against the Republic of North Macedonia. The country has also made progress in combating corruption through the adoption of the Law on Prevention of Corruption and Conflict of Interests in 2019.
More Work Needed
Despite these efforts, more work is needed to improve the effectiveness of law enforcement in fighting money laundering and organized crime. The FIO’s request for extended record-keeping is a step in the right direction, but it remains to be seen whether this will be enough to effectively combat these serious crimes.