Determination of risk factors for implementation of simplified customers due diligence for anti-money laundering purpose
Determination of risk factors for implementation of
On 10 June 2020, the Albanian Council of Ministers approved the Decision no. 458, on “Determination of factors and situations to be considered in assessment of risks for money laundering and terrorism financing” (“DCM”).
The Decision was published in the Official Gazette No.112, dated 15 June 2020 and is effective as of 16 June 2020.
This Decision must be applied by all the obliged entities defined by the Law no.9917, dated 19.05.2008 on “Anti-money laundering and terrorism financing” such as banks, non-bank financial institutions, exchange bureaus, insurance companies, real estate brokers, etc. The obliged entities must apply the simplified due diligence considering these indicative factors of low risk as of effective date of the Decision of Council of Minister i.e. 16 June 2020.
The DCM determines the indicative factors and situations representing low risk for money laundering and terrorism financing when the simplified customer due diligence might be applied for.
The DCM is applicable for assessment of risks related to type of customers, geographical area, products, services, special transactions or distribution channels for those cases when the simplified customer due diligence is applicable.
Low risk factors
The indicative factors of low risk, include the following:
Customer related factors:
- a public company listed on a stock exchange and subject to regulatory disclosure requirements (either by stock exchange rules or through law or enforceable means) that impose requirements to ensure adequate transparency of beneficial ownership;
- a public administration or a public enterprise
Risks related to products, transactions, services or distribution channels
- life insurance policy where the premium is low;
- Insurance policies in pension schemes without an early surrender option and when the policy cannot be used as collateral;
- a common pension scheme, superannuation or similar scheme that provides retirement benefits to employees, where contributions are made by way of deduction from wages and the scheme rules do not permit the assignment of a member’s interest under the scheme;
- financial services or products which ensure limited services and explicitly determined for certain customers category for the purpose of financial inclusion;
- products where the money laundering or terrorism financing risks are managed by other factors;
Geographical risk factors
- countries evaluated as countries with effective systems against money laundering or terrorism financing;
- countries identified by credible sources as countries with low level of corruption or other criminal activities;
- countries that, according to credible sources, such as joint assessment reports, detailed assessment reports or published observation reports, have requirements for combating money laundering or terrorist financing, in accordance with the Financial Action Task Force’s revised recommendations and effectively implement those requirements.
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