The Ministry of Finance is to present a draft law on encountering money laundering and funding of terrorism

12/20/16

The Ministry of Finance is going to present a draft law on preventing and fighting money laundering and funding of terrorism for a public discussion.

What’s it about?

To adjust the Ukrainian legislation to the EU rules and to meet the obligations towards the IMF, the Ministry of Finance jointly with the State Agency for Financial Monitoring prepared the above draft law which lays grounds for the incremental transition from the mandatory to internal financial monitoring based on the quantitative and qualitative approach in detecting suspicious financial transactions.

What does it deliver?

This draft law is aimed to comprehensively improve the national regulations on financial monitoring in the following points:

- the number of the criteria for financial transactions which must be reported by banks, insurance companies, loan associations, pawn offices, stock exchanges, payment service providers and other financial organizations to the State Agency for Financial Monitoring shall be significantly reduced. Transactions in question include, for example, those excessing 250 thousand hryvnas (currently 150 thousand hryvnas) as well as transactions involving cash, transfers abroad, transactions effected by entities from Iran, North Korea or public persons;

- the number of entities which carry out basic financial monitoring and are bound to report suspicious financial transactions will be increased;

- to make the identification of public persons easier, a single state register of national public persons and their relatives will be established on the basis of their declarations submitted to the National Agency for the Prevention of Corruption;

- the procedure for the identification of business beneficiaries as well as legal aspects which are crucial for the quality of investigations in money laundering will be improved;

- along with the implementation of the risk-oriented approach in reporting on suspicious financial transactions, entities which carry out basic financial monitoring will have proper tools to encounter respective violations like written warnings, fines amounting up to 10% of the revenues and license withdrawal.

What’s next?

After the public discussion the Ministry of Finance will present the draft law to the Government and then to the Parliament.

You are welcome to send your proposals and initiatives regarding this draft law to hohlov@minfin.gov.ua.

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