Financial Crime World

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Romania’s AML Regulations: What You Need to Know

In Romania, electronic payment instruments are used exclusively for purchasing goods or services and cannot be financed with anonymous electronic money. The maximum amount stored electronically does not exceed €150.

Enhanced Due Diligence (EDD) Requirements in Romania

Romanian businesses must apply EDD measures in situations with a high risk of money laundering, including:

  • Business relationships and transactions with individuals from countries included in the FATF NCCT list
  • Publicly exposed persons or clients whose real beneficiaries are PEPs
  • Individuals established in third countries identified by the European Commission as high-risk third countries

Correspondent relations with financial institutions in other EEA member states or third states must also imply EDD measures.

EDD Measures for Politically Exposed Persons (PEPs)

If there are occasional transactions or business relationships with PEPs or legal persons who have PEPs as their beneficial owners, businesses must apply the following measures:

  • Obtaining senior management approval for establishing or continuing business relations
  • Taking appropriate measures to establish the source of wealth and funds involved in business relations or transactions
  • Carrying out increased monitoring of the business relationship on a permanent basis

These measures also apply to family members or persons known to be close associates of PEPs.

EDD Measures for Correspondent Relations

In case of correspondent relations with financial institutions of other EU member states or third states, businesses must apply the following additional measures:

  • Obtaining information about the respondent institution on the nature of its activity and reputation
  • Obtaining sufficient information on the quality of supervision to which the respondent institution is subject
  • Assessing AML/ CFT mechanisms implemented by the respondent institution
  • Obtaining senior management approval before establishing each new correspondent relationship
  • Establishing responsibilities of each party

KYC Requirements in Romania

Know Your Customer (KYC) is the process of identifying and verifying customers. Romanian businesses must follow KYC requirements when working with their customers.

Identification of Natural Persons

For the identification of natural persons, Romanian businesses must obtain the following information:

  • Name and surname
  • Date and place of birth
  • Personal numerical code or another similar unique identifier
  • Address and legal status
  • Citizenship
  • Occupation and name of employer or nature of activity
  • Telephone number, fax, e- mail address (if applicable)
  • Source of funds

For the identification of legal entities, Romanian businesses must inquire for information about beneficial owners.

Determining the Beneficial Owner

Under Romania’s AML Law, the beneficial owner of a company can be direct or indirect. A direct beneficial owner is a natural person who exercises ownership or control over a company by holding 25%+ one share or participating in more than 25% of a company’s capital.

Ongoing Monitoring

Romanian businesses must implement ongoing verification of the accuracy of obtained KYC data to ensure that client risk profiles are correct and monitoring processes are efficient.

Sanctions

Failure to comply with AML obligations may result in fines up to 150,000 RON (approximately €30,000) or imprisonment from 3 to 10 years.

Key Takeaway

Romania’s AML regulations have broad implications for traditional and crypto businesses, both domestic and foreign. We will continue to track AML changes in Romania and update this article on an ongoing basis.

Let Sumsub help your company stay compliant with national KYC/AML requirements. Get in touch with us today.