Myanmar Tightens Anti-Money Laundering Regulations: Reporting Organizations Under Scrutiny
Strengthening the Fight Against Financial Crimes and Terrorism Financing
YANGON - In a bid to enhance its anti-money laundering (AML) regime, Myanmar has issued a range of directives and guidelines in recent months. The aim is to curb financial crimes and terrorism financing by imposing stringent requirements on reporting organizations.
Reporting Organizations Under the Spotlight
Reporting organizations, including banks, financial institutions, insurance companies, and certain non-financial businesses and professions, must implement robust policies, procedures, and controls to prevent and detect money laundering and terrorist financing activities. This includes:
- Conducting risk assessments to identify and mitigate potential risks
- Adopting a risk-based approach to customer due diligence with enhanced measures for high-risk customers and transactions
- Implementing ongoing monitoring of transactions to ensure consistency with customer profiles and risk assessments
Compliance Requirements
Reporting organizations must comply with the Anti-Money Laundering Law 2014 and the Anti-Money Laundering Rules 2015. Failure to do so can result in imprisonment for up to three years and fines.
Key compliance requirements include:
- Conducting enhanced customer due diligence, particularly for high-risk customers
- Filing suspicious transaction reports with the Financial Intelligence Unit (FIU) if there are grounds for suspicion
- Reporting transactions exceeding MMK 100 million or US$10,000, even in the absence of suspicion
Consequences of Non-Compliance
Senior management and compliance officers must ensure that measures are implemented and maintained through ongoing training and independent audits. Failure to comply with regulations can have serious consequences, including imprisonment and fines.
Reviewing Policies and Procedures for Full Compliance
As Myanmar continues to strengthen its AML regime, reporting organizations would be wise to review their policies and procedures to ensure full compliance with the extensive requirements. This includes:
- Conducting thorough risk assessments and implementing effective risk mitigation strategies
- Developing robust customer due diligence processes
- Establishing ongoing monitoring systems for transactions
- Providing regular training and support for employees
By taking a proactive approach to AML compliance, reporting organizations can minimize the risks associated with financial crimes and terrorism financing.