The New Anti-Money Laundering Law 2022

Money laundering Risk Assessment and Client Risk Classification

• The reporting entities are required to conduct a thorough risk assessment and develop a money laundering risk management procedure that must include rules for customer classification by the low, medium, and high risk level and relevant measures that would apply according to the customer’s level of risk.

• The SBV’s Governor is authorised to provide the criteria and the method to perform the money laundering risk assessment of the reporting entities.

Know Your Customer

• The new Law broadens types of customers of which the reporting entities must conduct KYC analysis, and further clarifies the scope of required KYC information for each type of customer. The requirement of “nature of the business relationship of the customer with the reporting entity” is added along with the current requirement of “purposes to set-up the business relationship with the reporting entity” as stipulated amongst the KYC information.

Third party service provider / outsource organisation

• The new Law has replaced the term “business operation through introduction” by the term “third parties” or “the outsourced organisation” who handles the customer information verification and the customer due diligence activities on behalf of the reporting entity, and accordingly sets forth several conditions that the third party must satisfy.

• The new Law continues to emphasize the accountability of the reporting entities for the results of customer information verification and the customer due diligence by the third party, and in addition, must ensure the third party maintains confidentiality obligations.

Transparency of the Information of Legal Arrangement

• When performing due diligence on a customer as a Trustee, the reporting entity may request the Trustee to provide the identity information of the Settlor / Grantor, the Trustee, the Beneficiary, and other parties concerned (if any), the natural person(s) who exercise the ultimate control(s) over the Trust.

Suspicious Transaction Reporting (STR) and temporary measure

• The new Law sets out a list of suspicious signs for various sectors including banking, payment intermediary, life insurance, securities, prize-awarding game / gaming and casino businesses, and real estate business sectors.

• The new Law also clarifies the elements of suspicious transactions that are subject to the regulatory reporting, including the case upon learning / having reasonable grounds that the transaction is conducted at the request of the accused, the defendant, or the convicted person, and that the assets in the transaction belong to the accused, the defendant, or the convicted person, and that the related parties involved in the transactions are on the blacklist. Accordingly, the reporting entity must apply the postponement on the suspicious transactions as described above.

• The time limit for applying the transaction postponement measure shall not be more than 03 working days from the commencement date. The reporting entity shall be excluded from the legal liability for any consequence following application of a transaction postponement measure as stipulated.

Time limit for reporting

The new Law has made several changes to the time limit for reporting, in particular:

• Reporting the high value transactions and electronic money transfers will be within one working day from the transaction date for e-reporting and two working days from the transaction date for paper reporting.

• Reporting the suspicious transactions will be within three working days from the transaction or within one working day from the date on which the suspicious transaction is detected.

• Where the reporting entity detects that the suspicious transaction requested by the customer is indicating criminal activities, the reporting entity must report to relevant authorities and the SBV within 24 hours from the date of such detection.