Financial Crime World

Argentina Confronts Complex Anti-Money Laundering Challenges Amid Corruption Concerns

======================================================

Argentina’s anti-money laundering (AML) efforts face significant hurdles, with corruption remaining a major concern for illegal funding sources, including proceeds from Venezuela. The Tri-Border Area shared by Argentina, Brazil, and Paraguay serves as a key entry point for illicit activities such as trade-based money laundering, counterfeiting, drug trafficking, and more.

International Initiatives

Argentina actively participates in international initiatives to combat money laundering, being a member of the Financial Action Task Force (FATF) and the Grupo de Acción Financiera de Sudamérica (GAFISUD), a FATF-style regional body dedicated to implementing the 40+9 Recommendations and conducting mutual evaluations of AML and counter-terrorist financing systems among its member nations.

Anti-Money Laundering Law No. 25,246

At the heart of Argentina’s AML efforts is Anti-Money Laundering Law No. 25,246, enacted in April 2000. The law defines money laundering as concealing or intensifying the proceeds of a crime after it has been committed.

Key Provisions

  • Amendments to the Penal Code
  • Establishment of the Financial Information Unit (UIF)
  • Stringent regulatory framework for financial institutions
  • Obligation for financial organizations and businesses to:
    • Identify customers
    • Maintain records of transactions
    • Report suspicious activities to the UIF
    • Adhere to confidentiality requirements
    • Forward cases to the Attorney General’s Office if further investigation is warranted

Money Laundering Offenses

  • Money laundering can only be committed by those who assist criminals after the fact in concealing the source of funds.
  • Transactions below 50,000 pesos (approximately USD 16,000) are considered concealment, a lesser offense.

Regulatory Framework

Since the enactment of the AML law, the UIF has issued several resolutions to expand the list of organizations required to report suspicious transactions, including:

  • Tax authorities
  • Customs
  • Banks
  • Currency exchange houses
  • Casinos
  • Securities dealers
  • Insurance companies
  • Postal money transmitters
  • Consultants
  • Public notaries
  • Businesses dealing in art, vintage items, and valuable gems

Strengthening AML and Counter-Terrorist Financing Regimes

Argentina has made significant strides in strengthening its AML and counter-terrorist financing regimes. Key regulatory authorities include:

  • The Financial Information Unit (UIF), responsible for receiving and analyzing reports of suspicious activities.
  • The Argentine Central Bank (BCRA), which plays a crucial role in supervising the financial sector and ensuring AML/CTF compliance.

BCRA’s Role

The BCRA established the “Comité de Control y Prevención de Lavado de Dinero y Financiamiento del Terrorismo” (AML/CFT Committee) to centralize evaluations and objectives related to AML/CFT. The BCRA regulates AML and CFT responsibilities for commercial entities, including:

  • Customer identification
  • Recordkeeping
  • Reporting of suspicious transactions
  • Development of internal policies and processes

Progress Made

Argentina has made significant progress in strengthening its AML and counter-terrorist financing capabilities, having been formally removed from the FATF’s follow-up procedure initiated in 2004 to address deficiencies in Argentina’s AML and CFT systems.