Main provisions of the Prevention and Suppression of Money Laundering Activities Law 2007
The main purpose of the Law is to define and criminalise the laundering of the proceeds generated from all serious criminal offences and provide for the confiscation of such proceeds aiming at depriving criminals of their profits. The main provisions of the Law can be found in the following articles:
- Prescribed offences (Section 3 of the Law)
- Laundering offences (Section 4 of the Law)
- Predicate offences (Section 5 of the Law)
- Failure to report (Section 27 of the Law)
- Tipping - off (Section 48 of the Law)
- Procedures to prevent Money Laundering and Financing of Terrorism (Section 58 of the Law)
OBLIGATIONS FOR FINANCIAL BUSINESS
The Law requires all persons carrying on financial and other business activities, to establish and maintain adequate and appropriate systems and procedures to guard against their business and the financial system in general, being used for the purposes of money laundering or financing of terrorism. In essence these procedures are designed to achieve two purposes: firstly, to facilitate the recognition and reporting of suspicious transactions and, secondly, to ensure the strict implementation of the "know-your-client" principle and the maintenance of adequate record keeping procedures.
The following procedures should be adopted:
The full text of the Prevention and Suppression of Money Laundering Activities Law 2007 and the amending Law of 2010 can be found in the attached document below:
- Customer identification procedures and customer due diligence;
- Record-keeping procedures in relation to clients’ identity and their transactions;
- Procedures of internal reporting to a competent person (Money Laundering Compliance Officer) and reporting to MOKAS;
- Other internal control and risk management procedures for the purpose of forestalling and preventing money laundering and financing of terrorism;
- The thorough examination of every transaction that is considered to be of high risk due to its nature and especially complicated or unusually large transactions and all transactions that are being executed with no profound economic reason;
- Measures for making employees aware of the above procedures, the legislation relating to money laundering and financing of terrorism, the directives issued by the competent Supervisory Authority and the relevant EU directives.
- Provision of training to their employees for the recognition and handling of transactions suspected to be associated with money laundering and financing of terrorism.