“The reform is very important and I think the most outstanding elements are: the updating the list of obligated subjects before, the granting of more sanctioning powers to the FIUsuch as warnings or disqualifications of Compliance Officers and the creation of a registry of Final Beneficiaries in the scope of the Federal Administration of Public Revenue, in which companies are going to have to declare who is behind them before the organization,” he details to Ambit Zenón Biagosch, advisor on financial regulation and former director of the Central Bank (BCRA).
New powers for the Financial Information Unit
Firstly, with regard to the point of law reform that assigns new powers to the FIUthe possibility of provide for the administrative freezing of funds or other assetsthrough a well-founded resolution and with immediate communication to the Public Prosecutor’s Office and/or the competent judge, in cases of operations suspected of financing terrorism and financing the proliferation of weapons of mass destruction.
“This is a fundamental faculty, in order to try to avoid possible terrorist acts,” he tells Ambit, Daniel Perrota, Consultant and international speaker on the Prevention of Money Laundering, who directs the consulting firm Decisio. And, in that sense, a central issue is that, based on this new law, more tools are introduced to combat organized crime.
New money laundering law: new sanctions
In that sense, for Perrotta, “the most important point of the new law is the implementation of a sanctioning regime that presents as novelties, lesser value sanctionssuch as the warning, but also some very burdensome ones, such as the disqualification of the members of the administrative body, to serve as Compliance Officer and even as a member of said Body.”
Likewise, he mentions that another important change becomes an increase in fines for non-compliance formal. “Currently they range from $10,000 to $100,000 for each non-compliance. The law imposes the so-called “modules” and the sanctions provided range from 15 to 2,500 modules for each violation,” explains Perrotta.
Explains that, considering the initial value of the module set at $40,000, upgradeable by the UIFthe fines to be applied will be initially from $600,000 to $100,000,000, for each of the possible breaches. And he considers that this, “without a doubt, will generate a deterrent effect regarding non-compliance by the Obligated Subjects, since these amounts of fines could even put the actors’ activity at risk of continuity.”
Money Laundering Prevention Law: new obligated subjects
Analysts agree on the fact that the list of obligated subjects was outdatedespecially taking into account, as Perrotta suggests, “the appearance and explosion, (accelerated by the pandemic) of new means of payment.”
Thus, among the new incorporated subjects, there are the payment service providers (PSP)intermediaries in the card payment chains, digital wallets and cryptocurrencies, which left a very important legal vacuum. “The issuers, operators and providers of collection and/or payment services and Payment Service Providers (PSP), virtual assets and non-financial credit providers are incorporated,” summarizes Perrotta.
He explains that, although the Virtual Service Providers (exchanges) They do not yet have a law that regulates their activity; by assigning them the status of obligated subjects before a supervisory body and a registration obligation, significant risk mitigation is achieved.
Likewise, Biagosch highlights the obligation imposed on the exchanges to register with the National Securities Commission (CNV). “It is also incorporated into the lawyers within the independent professions“They are obligated subjects,” he points out. And he highlights that all of these new actors “are going to have to greatly modify their activities and procedures.”
A complicated issue is the decision regarding the insurance intermediaries: institutional agents and Insurance Advisory Producers (PAS) as well as brokers, whose obligation only reaches those who market life insurance with savings or retirement insurance.
This is what Perrotta warns, who considers that although its incorporation is reasonable with certain limits due to the fact that the sector has not been a vehicle for laundering maneuvers in recent years, “the decision significantly complicates the management and compliance of insurers“, which even in the case of those that offer heritage products only, continue to be obligated subjects throughout the regulatory scope.
And finally, the law “removes non-profit organizations of the SO payroll but assigns the obligation to public bodies and authorities determined by the regulations, to develop functions aimed at preventing the financing of terrorism”.
Perrotta recalls that the pandemic offered opportunities for crime in general and in particular activities like these were exploited to commit crimes. “It is important that these organizations act accordingly. While This activity should be considered High Risk by the rest of the Obligated Subjects“, it states.
Obligations of Obligated Subjects
One of the most important obligations consists of the application of the Risk Based Approaches to all Obligated Subjects, today reaching some such as financial entities, insurance sector, market agents, cooperatives and games of chance among others.
This, says Perrotta, involves “determining the risk of money laundering, financing of terrorism and financing the proliferation of weapons of mass destruction associated with clients; products, services, transactions, operations or distribution channels; the geographical areas involved; carry out a self-assessment of such risks and implement suitable measures for their mitigation.”
Registry of Final Beneficiaries
Finally, there is the decision that the AFIP will centralize, as an enforcement authority, the creation of a Registry of Final Beneficiarieswith adequate, precise and updated information, referring to those human persons who have the character of final beneficiaries in the terms defined in the Law.
“It is not only a FATF recommendation, but an important collaboration of the State in a task that is complex to the different Obligated Subjects,” says Perrotta.
Source: Ambito
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