Financial Crime World

Uruguay’s Banking Industry Adheres to Stricter Anti-Money Laundering Regulations

The Uruguayan government has taken a firm stance against money laundering and terrorism financing, with various regulatory bodies playing key roles in enforcing strict compliance procedures within the banking sector. As of 1 July 2005, the Prevention of Money Laundering Act was expanded to include all financial institutions and intermediaries.

Key Regulatory Bodies

Four primary organisations supervise the Uruguayan financial industry and create anti-money laundering (AML) and counter-terrorism financing (CFT) regulations:

  • Central Bank of Uruguay (BCU): Established in 2004, the BCU is responsible for gathering and distributing information on suspected financial activity to law enforcement agencies and international financial intelligence units.
  • Coordinating Commission against Money Laundering and Terrorism Financing: This commission reports to the Republic’s Presidency Office and focuses on creating anti-money laundering efforts and tackling terrorist funding.
  • National Secretariat for Combating the Money Laundering and Financing of Terrorism (SENACLAFT): SENACLAFT is a decentralised organisation that reports directly to the Republic’s Presidency and exercises technical autonomy. It develops policies, coordinates training programs, produces statistics, enforces financial penalties, and monitors compliance with AML rules.
  • Unit of Financial Information and Analysis (UIAF): Created by the Board of Directors of the Central Bank of Uruguay, UIAF is responsible for analysing and reporting on suspicious financial activity.

Compliance Procedures

Financial and non-financial institutions in Uruguay must adhere to strict regulations, including:

  1. Establishing effective customer due diligence systems and monitoring programs.
  2. Screening against government lists, such as the Office of Foreign Assets Control (OFAC).
  3. Implementing an effective suspicious activity monitoring and reporting process.
  4. Developing risk-based AML programs.
  5. Conducting regular reviews of contractual arrangements and transactions to ensure compliance.

Reporting Obligations

Financial institutions and non-financial entities are required to submit various reports, including:

  • Reporting unusual or suspicious transactions to the Financial Information and Analysis Unit (UIAF) of the Central Bank of Uruguay.

The Uruguayan government’s commitment to combating money laundering and terrorism financing is evident through its strict regulations and enforcement mechanisms. As a result, the banking industry in Uruguay has become a model for other countries to follow in their efforts to prevent financial crimes.