Foreign Authority Requests Measures to Combat Money Laundering and Terrorist Financing

A foreign authority has requested that our government implement additional measures to combat money laundering and terrorist financing, aimed at strengthening our financial system and preventing illicit activities.

Freezing Orders

The authority is requesting that we modify our freezing order procedures, which currently grant a 15-day period for issuing such orders under Article 21/32 of the Administrative Procedures Code. The authority suggests that this period may be too permissive, and that “without delay” should be interpreted to mean within a matter of hours from the designation of the person.

Court Review

The authority is also requesting that we remove the court’s power to review freezing orders in relation to UN-designated persons, groups, or entities. This would allow for more efficient and effective implementation of sanctions against these entities.

Monitoring Entities

• The authority suggests that monitoring entities should have adequate processes in place to grant access to frozen funds for necessary or extraordinary expenses, in line with the requirements under UNSCR 1452.
• They recommend issuing more detailed guidance to monitoring entities on how to implement their obligations under freezing orders and ensuring that compliance is appropriately monitored.

Financial Intelligence Unit

The authority requests that we amend the Financial Intelligence Unit (FIU) to require real estate agents, lawyers, TCSPs, and electronic money institutions to report suspicious transactions. This would enhance the FIU’s receipt function and allow it to request additional information from these sectors.

Annual Reports

• The authority suggests that the FIU publish periodic annual reports with comprehensive statistics, typologies, and trends of money laundering and terrorist financing, as well as information regarding its activities.
• These reports should provide stakeholders with valuable insights into the nature and extent of money laundering and terrorist financing in our country.

Law Enforcement

• The authority recommends that law enforcement agencies investigate more proactively and regularly the money laundering and/or terrorist financing offenses.
• They suggest providing AML/CTF training to all investigative agencies at all levels, ensuring that they have the necessary skills and knowledge to effectively combat these crimes.

Cross-Border Declaration or Disclosure

The authority requests that we extend the requirements for declaring or disclosing cross-border cash and bearer negotiable instruments to include shipments of currency and bearer negotiable instruments through cargo containers and mail. They also recommend defining clearly the term “bearer negotiable instruments” and taking legislative steps to align the powers of Customs with regard to requesting and obtaining further information from carriers.

Financial Institutions

• The authority suggests that financial institutions regulate factoring activities, companies issuing payments such as credit and debit cards, and electronic money institutions under the AML/CTF Law.
• They recommend introducing a requirement for FIs to understand the ownership and control structure of customers and terminating business relationships where compliance with CDD requirements is not possible.

Customer Due Diligence

The authority recommends that financial institutions: + Remove the identification threshold for customers + Introduce a requirement for understanding the ownership and control structure of customers + Apply enhanced ongoing monitoring in business relationships with politically exposed persons (PEPs)

Correspondent Banking

• The authority suggests that financial institutions document their correspondent banking activities
• Approve correspondent relationships by senior management
• Periodically monitor these relationships with respect to AML/CTF issues
• Assess reputational risks arising from those relationships

The government is currently reviewing the foreign authority’s requests and will consider implementing the recommended measures to strengthen its anti-money laundering and counter-terrorist financing framework.