Financial Crime World

Title: New Ukrainian Legislation: Strengthening Financial Crime Reporting Against Terrorist Activities

Ministry of Infrastructure’s Reminder to Comply with Anti-Money Laundering and CTF Laws

  • The Ministry of Infrastructure in Ukraine issues a reminder for primary financial monitoring entities to adhere to the country’s anti-money laundering and counter-terrorist financing (AML/CTF) laws.
  • Entities must notify the Ministry of Infrastructure and the State Service for Financial Monitoring of Ukraine if they terminate business relations with suspected separatist or terrorist financiers.

Background: Conflict in Eastern Ukraine and the Need for Financial Sanctions

  • Ongoing conflict in eastern Ukraine and associated human toll, seizure of facilities, and socio-political worsening necessitate depriving persons related to terrorist and separatist activities of their financial sources.

Classification of High-Risk Clients

As per the State Service for Financial Monitoring of Ukraine:

  • Primary financial monitoring entities, or ‘subjects’ are required to classify clients based on risk criteria.
  • High-risk clients include:
    • Persons involved in terrorist activities
    • Individuals or organizations subject to international sanctions
    • Non-profit or charitable organizations (except those operating under international auspices)
    • Public officials or related persons
    • Residents of countries supporting terrorist activities
    • Leaders or founders of public or religious organizations
    • Foreign non-profit non-governmental organizations

Identifying Clients and Transactions

  • Entities must verify clients’ identity and assess their activity, transaction nature and level, and the purpose of the business relationship.

Potential Terrorist Financing Channels

  • Be aware of transactions:
    • Arising from countries supporting international terrorism
    • Conducted in the currency of such countries or by individuals from those nations

Assistance in Identifying Countries Supporting International Terrorism

For up-to-date list of countries:

  • Official media sources: Cabinet of Ministers of Ukraine, National Bank of Ukraine
  • International organizations involved in combating money laundering and terrorist financing

Reporting Suspicious Transactions

Responsible organizations for reporting:

  • State Service for Financial Monitoring of Ukraine
  • Security Service of Ukraine

Security Service of Ukraine’s Recommendations

  • Stop financial transactions conducted by persons mentioned in the list of individuals subject to sanctions:
    • European Union
    • United States (OFAC)

Lists of individuals subject to sanctions available on:

  • European Union website
  • US Department of the Treasury website