Types of Financial Crimes in Peru Expand to Include New Offenses

Peru’s Law No. 31740, aimed at preventing and punishing financial crimes, has undergone significant changes following a bill presented by the executive branch in November 2021. The updated law now includes new offenses and stricter penalties for companies found guilty of financial wrongdoing.

New Crimes and Penalties

The list of crimes for which companies can be held liable has been expanded to include:

• Parallel accounting
• Attempt against archeological monuments and paleontological zones
• Illegal extraction of cultural property and paleontological heritage
• Failure to report suspicious operations or transactions
• Refusal, delay, and falsehood in the provision of information during investigations or trials for money laundering, customs offenses, tax fraud, and terrorist crimes

International Accountability

The law also applies to foreign companies that carry out activities in Peru, regardless of whether they have a physical presence in the country. This is intended to hold international corporations accountable for their actions in Peru and prevent them from exploiting loopholes in the legal system.

Fine Penalty Criteria

In addition, the criteria for determining fine penalties have been replaced with a more nuanced approach. Judges will now take into account factors such as:

• Non-compliance with internal rules and procedures
• The number and hierarchy of employees involved
• The extent of the damage caused

Stricter Liability Standards

The law also introduces stricter liability standards for companies whose directors or executives are found guilty of financial crimes. In these cases, companies may be exempt from criminal prosecution if they demonstrate a robust prevention model, but this exemption will not apply if the crime was committed by individuals with the authority to control the company.

Technical Report No Longer Binding

Finally, the technical report of the Superintendence of the Securities Market on the suitability of a company’s prevention model is no longer binding. This means that prosecutors and judges must consider all evidence in their investigation or trial, rather than relying solely on the technical report.

Implementation Timeline

The amendments to Law No. 31740 are set to come into effect immediately after publication, except for the expansion of crimes, which will take effect within six months.