L&M Finance Group


We already wrote earlier that at the end of September, the Cabinet of Ministers of Ukraine supported the draft Law of Ukraine "On the prevention and counteraction of the legalisation (laundering) of proceeds from crime, the financing of terrorism and the proliferation of weapons of mass destruction." This project provides for a comprehensive improvement of national legislation in this area in the context of adapting the latter with the provisions of the fourth European Union Directive 2015/849 and European Union Regulation 2015/847, as well as the standards of the Group for the Development of Financial Measures against Money Laundering and the Financing of Terrorism (FATF).
On December 6, the Verkhovna Rada generally supported this draft law.
The consequence of the adoption of the said law will be:
  • simplification of the reporting procedure for financial transactions for the subjects of primary financial monitoring (hereinafter - SPS) (banks, insurers, payment organisations, etc.). For example, the amount of the amount of financial transactions subject to mandatory financial monitoring increases from 150 to 400 thousand UAH;
  • application of a risk-based approach during the procedure of customer checks, transition to a case-based method of suspicious transactions reporting;
  • introduction of new types of SPS: persons who provide information and consulting services on taxation issues;
  • improvement of the procedure for disclosing by the business entities their ultimate beneficial owners (controllers) and toughening the requirements for identifying the SPS of the beneficial owners of their customers;
  • introduction of international assets freezing tools and regulation of the activities of the SPS with assets related to terrorism and its financing;
  • improvement of legislative aspects that affect the quality of investigation of crimes in the field of legalisation (laundering) of proceeds from crime;
  • improvement of legislative provisions ensuring the confidentiality of the receipt and implementation by the SFM of requests, decisions and instructions of the State Financial Monitoring, and, as a result, protection of the SFM from threats, discriminatory actions and other negative consequences associated with the implementation of measures for initial financial monitoring;
  • establishing a transition to tracking money transfers as a tool to prevent, detect and investigate cases of money laundering and terrorist financing, as well as to implement restrictive measures.
  • introduction of responsibilities for payment systems:
(1) accompany money transfers with information about the payer and recipient of the transfer;
(2) ensure the availability and completeness of information about the payer and payee;
(3) establish measures aimed at countering the manipulation of money received from crimes related to the legalisation (laundering) of proceeds from crime and the financing of terrorism.