Financial Crime World

Uruguay’s Crusade Against Financial Crime: Tightening AML/CFT Regulations

Montevideo, Uruguay - Uruguay’s financial sector is taking a firm stand against money laundering and terrorist financing (ML/TF) under new, stringent Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) regulations. Introduced under the 19,574 Law, these measures impact both financial and non-financial institutions.

Effective Customer Due Diligence (CDD)

Local institutions are required to establish robust CDD systems and monitoring programs under the new rules. These measures aim to:

  1. Identify and verify clients’ identities
  2. Ensure clients are not involved in suspicious or illegal activities

OFAC and Government Lists

Institutions are mandated to screen their clients against the Office of Foreign Assets Control (OFAC) list and other government lists to mitigate risks of dealing with individuals or entities associated with financial crimes.

Suspicious Activity Reporting (SAR)

Financial establishments must establish a functional suspicious activity monitoring and reporting process. This process enables institutions to:

  1. Detect and report potential ML/TF activities
  2. Prevent ongoing money laundering or tax evasion

Risk-Based Anti-Money Laundering Programs

Uruguayan institutions must develop tailored AML/CFT programs based on their specific risks, commercial relationships, and transaction types.

Final Beneficiary Confirmation

Institutions are obliged to ascertain the true identity of the ultimate beneficial owner:

  1. Typically representing at least 15% of the capital or voting rights
  2. Holding the final decision-making authority

Business Relationship Information

Financial service providers must obtain comprehensive information about:

  1. The purpose of the business relationship
  2. The nature of the intended business activities

Regular Reviews

Institutions must periodically review contracts and transactions to ensure ongoing compliance with both the client’s profile and the facts at hand.

Suspicious Activity Reporting

Institutions are mandated to report any potential ML/TF activities to relevant authorities. Examples of such activities include money laundering or tax evasion.

These new regulations aim to:

  1. Strengthen Uruguay’s financial system
  2. Enhance the country’s international reputation
  3. Ensure maximum transparency and adherence to global anti-financial crime standards