Business representatives and the regulator discuss problems of money-laundering law application
The Bank of Russia and business community are planning to hold quarterly consultations on issues related to banks using the right to refuse to open and maintain bank accounts or to conduct bank operations, the right to terminate bank account agreements under the law on countering the legalisation of criminally obtained incomes (anti-money laundering) and the financing of terrorism (AML/FT), as well as on issues of bank customer rehabilitation.
On 23 May 2019, the Bank of Russia hosted one such meeting with the involvement of representatives from public organisations Opora Russia and Business Russia, the Chamber of Commerce and Industry and the Agency for Strategic Initiatives.
Dmitry Skobelkin, Deputy Governor of the Bank of Russia, spoke about the measures already in place and to be introduced by the regulator to address the issue of unreasonable refusals. Now that, as agreed with Rosfinmonitoring, starting April 2019, the Bank of Russia has changed the procedure for informing credit institutions about refusals, banks are only notified about clients who have conducted high-risk operations. As a result, the number of notifications received by credit institutions has more than halved, Dmitry Skobelkin noted.
The regulator has prepared methodological recommendations for banks on informing clients about the reasons behind the refusals of bank services.
The Bank of Russia also participates in legislative amendments drafted by the Ministry of Finance and designed to clarify the reasons underlying refusals by credit institutions. It is assumed that a refusal is only possible where a bank has sufficient reasons to believe that the purpose of a specific operation is to legalise criminally obtained incomes or to finance terrorism.
At the same time, businesses do not always understand the reasons of so-called blocking, and tend to link all problems associated with funds transfer limitations to the application of the anti-money laundering legislation, outlined Mikhail Mamuta, the head of the Service for Consumer Protection and Financial Inclusion. As estimated by experts, more than a half (56%) of all instances of blocking have been caused by taxation requirements, rather than AML/FT considerations.
The regulator plans to pay more attention to raising awareness among businesses. To do this, it prepares methodological recommendations for businesses regarding their cooperation with credit institutions on the issues of anti-money laundering legislation.
“The new format of cooperation between the regulator and business community will allow them, via dialogue, to more efficiently and promptly resolve all complicated AML/FT issues,” believes Dmitry Skobelkin, Deputy Governor of the Bank of Russia. “This will help maintain a necessary balance in credit institutions’ efforts to conduct anti-money laundering measures and enhance transparency of the economy, on the one hand, and ensure the interests of business, and provide services to bona fide clients, on the other.”