Kazakhstan is going to be more suspicious toward financial transactions
A consultation document for amendments to the anti-money laundering law prepared by the Agency for Regulation and Development of the Financial Market (ARDFM) proposes lowering the thresholds for financial transactions that are considered suspicious. Currently, the document is available for public consideration.
The draft document proposes to revise the current rules that require commercial banks to report to the government about high-risk clients. The agency now believes that this practice is questionable from a legal point of view as it can encourage banks to terminate relationships with such clients.
If the proposal is approved, national security agencies will be responsible for preparing a list of high-risk clients. In addition, the agency wants a single national system and a database to be created. The system should register all participants of the financial market who are currently outside of governmental control like civil-law notaries and lawyers, while the database will accumulate information about participants of the financial market suspected of money laundering or financing terrorism.
The ARDFM also wants to expand its monitoring of transactions by microfinance organizations (MFOs) and private entrepreneurs, which are currently almost hidden from state control. For instance, last year, the agency received 746,300 messages about transactions subject to financial monitoring and MFO and individual entrepreneurs accounted for just 1,700 and 431 of them, respectively. The authorized agency believes that this is clear proof that these entities are poorly monitored.
In this regard, for the purposes of monitoring the ARDFM proposes a decrease in the threshold for transactions by private entrepreneurs and jewelers from $10,638 to $6,382; from $21,276 to $10,638 for MFOs and $2,127 for pawnshops. Moreover, the regulator is planning to establish threshold values for commodity exchanges (they are currently absent) and introduce penalties for providing false data about financial transactions subject to compulsory control.
