Title: Micronesia’s War on Money Laundering: An Overview of the New Law

Subchapter I: General Provisions

The Federated States of Micronesia (FSM) passed a new law to prevent money laundering and strengthen the financial system. This article provides an overview of Subchapter I, which sets the foundation for the Act’s implementation.

Title: General Provisions

The objective of this chapter is to:

• Confiscate the proceeds of crime
• Prevent misuse of financial systems for money laundering
• Extend the jurisdiction of the law to FSM’s land, waters, and airspace

Key Sections

Section 902: Extends jurisdiction

Section 903: Definition section

Sections 904-906: Convictions, quashing of convictions, and property value

Section 908: Dealing with property and consequences

Sections 918-921: Penalties, related offenses, and compliance requirements

Subchapter II: Enforcement Measures

FSM’s efforts to combat money laundering have been fortified with the passing of Subchapter II, which vests primary enforcement authority in the FSM Department of Justice.

Responsibilities of the Department of Justice:

• Receiving and investigating suspicious transactions reports
• Inspecting records
• Advising the President
• Promulgating regulations

Compliance Requirements for Financial Institutions and Cash Dealers

Section 913: Client identification

Section 915: Reporting suspicions

Sections 916-918: Establishing internal reporting procedures and providing employee training

Penalties for Non-compliance

Section 919: Offenses related to money laundering

Both individuals and financial institutions face severe consequences for non-compliance with the regulations. For more information, consult Sections 918-921.

Together, these components create a comprehensive legislation to tackle money laundering efficiently and bolster the FSM’s financial system. The combination of penalties, reporting requirements, and investigative authority deters potential money launderers and strengthens the nation’s financial institutions.