Stricter Anti-Money Laundering Regulations for Spanish Firms
Madrid Enforces Tougher Rules to Combat Money Laundering and Terrorist Financing
Spain has introduced stricter regulations on financial institutions and professionals operating in the country to prevent money laundering and terrorist financing. The new rules require companies and individuals to provide specific documents before conducting certain transactions.
Compliance with European Union Directives
The regulations are part of Spain’s efforts to comply with European Union directives aimed at preventing money laundering and terrorist financing. Law 10/2010 requires financial institutions, notaries, lawyers, and real estate developers to identify their customers and verify the origin of their funds before establishing business relationships or executing transactions.
Who Must Comply?
The regulations apply to all relevant persons, including:
- Financial institutions
- Notaries
- Lawyers
- Real estate developers
Companies must have procedures in place for identifying and accepting customers, as well as classifying them according to risk.
Identification Requirements
Individuals seeking to establish business relationships or execute occasional transactions worth €1,000 or more must provide legally valid documents for formal identification purposes. These documents include:
- National identity cards
- Residence permits
- Passports
- Other personal identification documents issued by a governmental authority
Legal entities must provide public documents proving their existence, corporate name, address, directors’ identities, bylaws, and tax identification number.
Enhanced Verification Requirements
Companies are required to identify the beneficial owner, verify their identity, and gather information on the purpose and nature of the business relationship. This includes gathering documents such as:
- Pay slips
- Pension receipts
- Professional association membership cards
- Proof of social security contributions
In situations where there is a higher risk of money laundering or terrorist financing, companies must perform enhanced verifications.
Consequences of Non-Compliance
Failure to comply with the regulations can result in:
- Fines
- Criminal charges
- Reputational damage
It is essential for companies operating in Spain to ensure that they are compliant with anti-money laundering laws to avoid penalties and reputational damage.
References
The regulations are part of Spain’s efforts to comply with European Union directives, including Directive (EU) 2018/843 and Commission Delegated Regulation (EU) 2019/758. The country has also adopted recommendations issued by the Financial Action Task Force on money laundering and terrorist financing.