Banks to refuse to open account if they consider transaction suspicious

15:41, 30 октября 2023, Bishkek - 24.kg news agency , Tatyana KUDRYAVTSEVA

It is proposed to amend the resolution of the National Bank of Kyrgyzstan on the issues of combating the financing of terrorist activities, money laundering and regulatory banking reporting. The document has been submitted for public discussion.

Changes are being made to 17 regulatory legal acts of the National Bank regulating the activities of banks and non-banking financial and credit organizations.

The draft resolution proposes to determine a list of criteria/signs of suspicious operations (transactions), on the basis of which commercial banks may refuse to open an account, conduct a client’s transaction, or terminate business relations with him or her.

The changes also apply to:

• Increasing the threshold amount for exchange transactions with cash foreign currency, during which commercial banks and non-bank financial and credit organizations conduct due diligence of the client, from 70,000 to 100,000 soms;
• Granting the authority to commercial banks to suspend suspicious operations (transactions) for up to five working days and send a report to the financial intelligence agency;
• Establishing a requirement for inspectors to prepare a report based on the results of the risk assessment in the activities of non-banking financial and credit organizations.

If the bank has suspicions that operations (transactions) are related to the financing of terrorist activities and money laundering, then it will have to:

• Carry out identification and verification of the client and beneficial owner, regardless of any exceptions or established thresholds;
• Conduct a comprehensive analysis of the business relationship or operation (transaction) and make a decision to recognize the business relationship or operation (transaction) as suspicious;
• Suspend the suspicious operation (transaction) for up to five working days and, within five hours from the moment the operation (transaction) is recognized as suspicious in the established manner, send a report of the suspicious operation (transaction) to the financial intelligence agency. In turn, the Financial Intelligence Service studies the operation within five days and then provides the bank with a response about the results;
• Suspend or terminate business relations with a client.