Turkey’s Independent Attorneys Must Conduct Customer Due Diligence and Report Suspicious Transactions

New Regulations Aim to Prevent Money Laundering and Terrorist Financing

Ankara, Turkey - The Turkish government has introduced new regulations requiring independent attorneys to conduct customer due diligence and report suspicious transactions to prevent money laundering and terrorist financing. These regulations apply to all independent attorneys, regardless of the amount of the transaction.

Know-Your-Customer (KYC) Checks Required

According to the new rules, independent attorneys must conduct a know-your-customer (KYC) check for any permanent business relationship with their clients. This includes:

• Verifying the client’s identity
• Confirming the client’s address
• Obtaining other relevant information

The attorney must also keep records of this information for at least eight years.

Reporting Suspicious Transactions

In addition, independent attorneys are required to report any suspicious transactions to the Financial Crimes Investigation Board (MASAK). A suspicious transaction is defined as a transaction that may have been carried out using illegal funds or for illegal purposes.

Specific Requirements

The regulation sets forth specific requirements for KYC and the reporting of suspicious transactions. For instance:

• If an independent attorney conducts a real estate transaction worth more than TRY 20,000, they must conduct a KYC check on the client.
• If an electronic transfer exceeds TRY 2,000 or the sum of multiple related transactions exceeds TRY 20,000, the attorney must also confirm the client’s identity.

Consequences for Non-Compliance

Independent attorneys who fail to comply with these regulations may be subject to administrative fines of up to:

• TRY 50,000 for failure to report suspicious transactions
• TRY 30,000 for failing to conduct a KYC check

The regulation aims to prevent money laundering and terrorist financing by ensuring that independent attorneys have adequate procedures in place to identify and report suspicious activities.

Implementation of International Standards

The regulation is part of Turkey’s efforts to implement the recommendations of the Financial Action Task Force (FATF) and to comply with international standards for combating money laundering and terrorist financing.

Expanded Scope of Obligated Parties

In related news, Turkey’s President has recently signed a decree increasing the fines for non-compliance with the regulation. The decree also expands the scope of obligated parties to include independent attorneys, in addition to other financial institutions and professionals.

Effective Date

The regulation is effective as of [date] and all independent attorneys are required to comply with its provisions.