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04.08.2011

Regulation on bank’s activity regarding prevention and combat of money laundering and terrorist financing, approved by the DCA of the NBM, No. 172 of August 4, 2011

Published in the Official Monitor of the Republic of Moldova no.170-175/1554 of 14.10.2011

Registered
at Ministry of Justice
of the Republic of Moldova
No. 844 of 28.09.2011

Council of Administration
of the National Bank of Moldova

 

Decision No.172
of 04.08.2011

on approving the Regulation on bank’s activity regarding prevention
and combat of money laundering and terrorist financing

Under Art.11 and 44 of the Law no.548-XIII on the National Bank of Moldova of 21 July 1995 (Official Monitor of the Republic of Moldova, 1995, no.56-57, art.624), including subsequent amendments and additions, Art.23, 25, and 40 of the Law on Financial Institutions no. 550-XIII of 21 July 1995 (republished in the Official Monitor of the Republic of Moldova, 2011, no.78-81, art.191), including subsequent amendments and additions, and Art.10 paragraph (2) of Law no. 190-XVI on prevention and combat of money laundering and terrorist financing of 26.07.2007, (Official Monitor of the Republic of Moldova, no.141-145, art.597), including subsequent amendments and additions, the Council of Administration of the National Bank Moldova

DECIDED:

1. To approve the Regulation on bank’s activity regarding prevention and combat of money laundering and terrorist financing (see attached).

2. This decision shall enter into force at the expiration of two months from the date of publication in the Official Monitor of the Republic of Moldova.

Chairman
of the Council of Administration

of the National Bank of Moldova

DORIN DRĂGUŢANU

Attachment to the
Decision of the Council of Administration
of the National Bank of Moldova
no. 172 of 04.08.2011

REGULATION
on bank’s activity regarding prevention and combat of
money laundering and terrorist financing

Chapter I
GENERAL PROVISIONS

1. The Regulation on bank’s activity regarding prevention and combat of money laundering and terrorist financing (hereinafter Regulation) is issued for the enforcement of the Law on prevention and combat of money laundering and terrorist financing and international recommendations in this field and establishes the requirements for the development, organization, implementation and monitoring of compliance by banks with their own programs on prevention and combat of money laundering and terrorist financing, as well as other requirements in order to minimize the risks related to money laundering and terrorist financing.

2. Banks shall apply this Regulation when establishing the business relations with its customers and when carrying out banking transactions and operations.

3. The terms and expressions used in this Regulation shall have the meanings provided in the Law on Financial Institutions, Law on National Bank of Moldova, Law on prevention and combat of money laundering and terrorist financing, normative acts of the National Bank of Moldova and the Service of Prevention and Combat of Money Laundering issued for their execution. In addition, for the purposes of this Regulation, the following terms and expressions are used:
significant transaction - transaction (operation) exceeding the limit values ​​set in the bank's internal programs for categories of customers;
occasional transaction - transaction (operation) performed in the absence of a business relationship with the bank;
electronic transaction - any transaction (operation) made ​​by an individual or legal entity (initiator) through a bank, using electronic means;
anonymous account - account whose owner is unknown;
fictitious name on account - account opened in the name of a person who is not identified and which is assigned with an invented name.
payable through accounts – banking service, allowing third parties-bank clients to use directly banks correspondent accounts for transactions on their own behalf.
private banking – activity of providing personalized and confidential financial assistance to wealthy clients or those with significant liquid assets.

 

Chapter II
RESPONSABILITITIES

4. Banks shall have internal programs on prevention and combat of money laundering and terrorist financing.

5. The Board of the bank shall be responsible for the development, approval and implementation of programs for prevention and combat of money laundering and terrorist financing. The Board and the executive body of the bank shall be responsible, within their competence, for the bank's compliance with the legislation in the field of prevention and combat of money laundering and terrorist financing.

6. The internal audit or other controlling unit shall carry out an independent evaluation of the adequacy and compliance of bank’s activity with the programs on prevention and combat of money laundering and terrorist financing at least quarterly. The evaluation results shall be communicated to the Bank Board, Commission of Censor, executive body of the bank, as well as the National Bank of Moldova in accordance with the Instruction on compilation and submission of reports regarding the financial activity by banks, approved by the Council of Administration of the National Bank of Moldova no.36 of 08.08.1997.

7. Commission of Censor shall carry out the evaluation, at least annually, of the reports and recommendations made by internal audit regarding prevention and combat of money laundering and terrorist financing, as well as the way they are implemented.

 

Chapter III
STRUCTURE OF PROGRAMS FOR PREVENTION AND
COMBAT OF MONEY LAUNDERING AND TERRORIST FINANCING

8. The programs on prevention and combat of money laundering and terrorist financing represent policies, procedures and other rules, including know-your-customer rules, which promote ethical standards and professionalism in the banking sector and prevent the use of bank for the purpose of money laundering or terrorist financing, intentionally or unintentionally, by criminal elements. These programs shall provide banking operations in a safe and prudent way.

9. Banks shall develop programs on prevention and combat of money laundering and terrorist financing in accordance with the provision of the legislation in force, also taking into account the generally accepted practice in this field, including documents of the Basel Committee and of the Financial Action Task Force (FATF).

10. When developing programs, it should be taken into account the size, complexity, nature and volume of bank activities, types (categories) of customers, the degree (level) of risk associated with different customers or their categories and the transactions (operations) conducted by them.

11. The programs on prevention and combat of money laundering and terrorist financing shall provide, without limitation, the followings:
1) obligations of the bank's executive body, which shall include at least:
a) understanding the criteria (indices) of high-risk customers;
b) approval of significant transactions of high-risk customers (or delegation of power of approval of the bank branch administrators, as appropriate);
c) determination of bank's areas of activities vulnerable to the risk of money laundering and terrorist financing, with exact delineation of the duties of each subdivision with the function of prevention and combat of money laundering and terrorist financing. The areas of activities vulnerable to the risk of money laundering and terrorist financing may be those touching upon the followings: accepting deposits, using payment instruments, credit operations, banking correspondent accounts, accounts opened by intermediaries in the process of exercising their professional activities as an agent, remote banking service systems, money remittance systems, trade finance, brokerage and trust management operations, etc.;
d) assurance of removal of noncompliance identified regarding prevention and combat of money laundering and terrorist financing;
e) implementation of programs on prevention and combat of money laundering and terrorist financing, including determining the responsibilities of staff at different hierarchical levels;
f) implementation of internal procedures regarding the access in a reasonable time of responsible staff to the information necessary for the performance of job obligations;
2) customer acceptance procedures that establish at least the categories of customers that the bank aims to attract and the hierarchical level of staff that approves the entering into business relationship with them, depending on the degree of associated risk, types of products and services that are provided;
3) measures to identify, verify and monitor customers and beneficial owners, depending on the degree of associated risk (knowing-your-customers rules), the criteria and procedure for the movement of customers from one risk category to another;
4) content of standard measures and enhanced due diligence measures with respect to know-your-customer for each category of customers, products and services or transactions (operations) subject to these measures;
5) procedures to monitor the operations carried out ​​by customers in order to detect the significant, complex and unusual transactions, suspicious activities and transactions;
6) procedures and requirements regarding taking enhanced measures when performing complex and unusual transactions without a clear economic or lawful purpose, as well as to the significant and suspicious transactions;
7) ways of dealing with customers and transactions carried out by customers with the countries / areas which do not have rules against money laundering and terrorist financing, or have inadequate rules to that effect, or represent a high risk due to high crime and corruption and / or are involved in terrorist activities;
8) way of drawing and maintaining the information and the way of establishing the access to it;
9) procedures for internal and external (to the competent authorities) reporting regarding suspicious activities and transactions;
10) verification procedures and measures of compliance with the standards developed and the assessment of their effectiveness;
11) standards for staff recruitment, employment and training in know-your-customers field;
12) procedures to identify and analyze risks related to money laundering and terrorist financing, including ways to minimize them, regarding the use of information technologies, including new ones, purchased or developed in the process of products development or services offered by the bank.

12. Banks shall review (update), whenever it is necessary, programs for prevention and combat of money laundering and terrorist financing, at least annually, taking into account the provisions of legislation in force.

 

Chapter IV
KNOW-YOUR-CUSTOMER RULES

Section 1
Customer acceptance procedures

13. Customer acceptance procedures shall contain a description of bank customers that seem to expose the bank to a high risk by using it for money laundering and terrorist financing purposes. In order to minimize this risk, the information on customers shall be examined under a range of issues, such as customers experience in the field of activity, country of origin, social position, activities or other risk indicators established by the bank, taking into account the Recommendations on banks’ risk-based approach actions taking in relation to their customers in the context of prevention and combating money laundering and terrorist financing, approved by the Decision of the Council of Administration of the National Bank of Moldova no.96 of 05.05.2011.

14. Customer acceptance procedures shall include several steps depending on the degree of customers’ risk, focusing on wealthy customers whose source is unclear or not identified. Decisions to begin, continue, or terminate the business relationships with customers with an increased risk shall be taken by a member of the executive body of the bank or branch administrator.

15. Customer acceptance procedures shall not restrict the general public access to general banking services.

 

Section 2
Customer identification measures, monitoring of activities and transactions

16. Banks shall apply identification measures to customers, as well as to their beneficial owners:
a) up to setting up business relationships or up to opening bank accounts;
b) for occasional transactions in an amount of at least MDL 50000, and electronic transactions totaling at least MDL 15000, regardless of whether the transaction is carried out through a single operation or several operations;
c) if there is a suspicion of money laundering or terrorist financing, regardless of any set exceptions, exemptions or limits;
d) if there are doubts about the veracity and accuracy of identification data.

17. For the identification of customers in cases referred to in item 16, banks shall apply the following standard know your customers measure:
1) for individuals –banks shall obtain at least the following information:
a) name and surname;
b) date and place of birth;
c) citizenship;
d) information included in the identity document: state identification number (tax code), series and personal code, issue date, the code of the body that issued the ID (if any) or other unique indices contained in an ID with the bearer's photograph (passport, identity card, residence permit issued by the authorities of the Republic of Moldova and other identity documents);
e) home address and / or residence;
f) occupation, public position held and / or name / full name of the employer;
g) purpose and nature of the business relationship with the bank – in cases referred to in item 16, letter a), c) and d);
h) telephone, fax, electronic mail (email) (if any);
i) signature;
2) for legal entities and individuals that carry out entrepreneurial activities - banks shall obtain at least the following information:
a) full and abbreviated name (if any), legal form;
b) headquarter and mailing address, other than the headquarter (if any);
c) information on the state registration: state identification number (tax code) and date of state registration in accordance with the registration certificate and / or extract from the State Register issued by the body authorized with the right to make state registration;
d) certified copy of articles of incorporation, as amended and supplemented, if applicable (or copy made by the bank form the original documents);
e) information on identity of persons invested with the right to open and / or hold the account, lead and represent the legal entity and individual carrying out entrepreneurial activities;
f) telephone number, fax, e-mail, as appropriate;
g) nature and purpose of the activity.
3) when performing foreign exchange operations in cash with individuals through foreign exchange bureaus, banks shall identify the individuals in accordance with the Regulation on foreign exchange entities, approved by the Decision of the Council of Administration of the NBM no.53 of 5 March 2009.

18. Banks shall identify the beneficial owner of the customer and shall apply reasonable risk-based measures to verify its identity so as to be convinced who is the beneficial owner in order to understand the ownership and control structure of the customer. To identify the beneficial owner, banks shall implement the measures described in item 17.

19. As for the identification of the beneficial owner of the legal entity with complex ownership structure (legal entity whose direct owners are not individuals), banks shall determine the beneficial owner based on the appropriate registration documents.

20. It is not necessary to identify and verify the identity of the beneficial owner in cases when the customer or legal entity - the owner of the controlling interest of the customer, is a joint-stock company which securities are accepted for transaction within a regulated security market, being subject to public disclosure of information requirement.

21. Banks shall determine whether the person opening the account or initiating a business relationship acts in his name (person’s declaration on the beneficial ownership), but if the opening of the account or initiation of the business relationship is performed by an empowered person, banks shall require an attorney legalized in accordance with the law. Banks shall apply measures to identify the empowered person as in accordance with the provisions of this Regulation. The person’s declaration on the beneficial ownership is fulfilled by the beneficial owner or by the empowered person accordingly, and shall contain information as of the item 17 paragraph 1) of this Regulation.

22. In order to identify the customer, banks shall verify the presented information regarding both the customer and the beneficial owner.

23. Banks shall verify the identity of the customer and beneficial owner up to establishing the business relationship or when establishing a business relationship or conducting transactions under the item 16 letter b).

24. In order to verify the information submitted for the identification of the customers and beneficial owners, banks shall use reliable and independent sources:
1) for individuals –banks shall verify the information based on the documents issued by a public authority or by an entity entitled to issue such documents. The information that cannot be proved by the documents listed above, it shall be verified by any other method, taking into consideration the degree of risk, such as:
a) to confirm the date of birth – birth certificate;
b) to confirm the address of residence if it is not the same as home address - by asking for utilities bills, documents confirming the payment of taxes, information from public authorities or other persons;
c) to confirm the information presented after opening the account - by contacting the customer by phone, fax or e-mail (if any);
d) to confirm the validity of identity documents – by certificates issued (for example, based on state or private registers) by public authorities or other competent persons (for example, notaries, embassies, etc.);
2) for legal entities and individuals carrying out entrepreneurial activities - by any appropriate method, taking into consideration the risk based approach, so the bank to be ensured about the veracity of information, such as:
a) verification of the legal existence of the legal entity and individuals carrying out entrepreneurial activities by verifying the registration in the State Register of legal entities or, where appropriate, in another public or private registry;
b) verification of customer information in databases on existing business relationships;
c) review of last financial reports (except opening an account for a newly established legal entity and individuals carrying out entrepreneurial activities) and externally audited accounts, if applicable;
d) performance of an analysis, either individually or through another person regarding the existence of insolvency, liquidation or sale process, or other potential financial problems;
e) obtaining reference from a bank with which the customer had business relationships in the past, if any;
f) contacting the customer by phone or fax, by post or e-mail, verifying the information on the website of the customer, if any, or making an onsite trip to the office or another address of the legal entity and individuals which carry out entrepreneurship activities;
3) for the beneficial owner – measures provided for in sub-item 1).
4) if a person is empowered on behalf of the customer to open an account or to carry out transactions, the bank shall verify his identity and the identity of the person in whose name he operates, using the same procedures described in this Regulation.
5) when performing foreign exchange operations in cash with individuals through foreign exchange bureaus, the bank shall verify the individuals in accordance with the Regulation mentioned in item 17, paragraph 3).

25. Documents presented to identify the customer and the beneficial owner shall be valid on the submission date.

26. Documents shall be presented by the customer in the original or a copy (photocopy) certified properly, if not required by law otherwise. If the documents are submitted as copy (photocopy), banks shall request the original documents in order to verify whether the copy (photocopy) corresponds to the original documents.

27. For business relationships, banks shall revise and update whenever necessary, but at least annually, the information related to identification of the customers and their beneficial owners.

28. Banks shall continuously monitor the activities, transactions (operations) of the customer or business relationship with it. Continuous monitoring actions include:
1) determining the ordinary transactions (specific) of the customer;
2) detailed examination of transactions during the business relationship to make sure they are consistent with the information available to the bank, with the activity and risk associated with the customer. The examination of transactions involves at least that the bank shall have mechanisms/automated solutions to detect suspicious activities, transactions and persons. The detection of suspicious activities, transactions and persons can be accomplished by setting the threshold ​​for a particular group of category of transactions, banking accounts. A special attention is paid to transactions exceeding these threshold and transactions that do not have a visible economic purpose (for example, those that seem to have no economic sense or that involve large amounts of money, which are not specific for normal or expected transactions of the customer);
3) verifying whether the documents and information gathered during the monitoring process of customers and transactions are updated and relevant, including those of customers or business relationships with a high degree of risk;
4) reporting to the administrator responsible for the information necessary to identify, analyze and effectively monitor the customer accounts and transactions, including high-risk customers;
5) identification of suspicious activities, transactions, including those potential and the sources of funds used in these activities and transactions.

29. Banks shall pay special attention to all significant, complex or unusual transactions, which have no economic or legal purpose. Bank shall examine the nature and purpose of these transactions, documenting all findings in writing and conducting enhanced due diligence with respect tothese transactions, according to the requirements of this Regulation. In such situations, banks shall obtain supporting documents for the transactions and shall determine the source of funds used (contracts, invoices, shipping documents, customs declarations, certificates on salary, tax reports, activity reports and other documents).

30. Banka are obligated:
a) not to open the account, not to establish business relationship, not to carry out transactions with the customer if the bank cannot ensure compliance with items 16 -18, 23 and 24;
b) in case of an existing business relationship, banks shall end the business relationship if it finds that the information obtained are unauthentic (doubtful);
c) to report the circumstances specified in letter a) and b) to the competent authority in accordance with the Law on preventing and combating money laundering and terrorist financing.

31. Banks shall not open and maintain anonymous or fictitious accounts, shall not establish or continue a business relationship with a fictitious bank or a bank known that allows another fictitious bank to use its accounts.

 

Section 3
Customer Enhanced Due Diligence Measures

32. In order to enforce the law on preventing and combating money laundering and terrorist financing, banks shall determine the categories of customers, activities and transactions (operations), which have a high degree of risk based on indicators set, where appropriate, by the volume of assets or income, type of requested services, type of activity, economic circumstances, reputation of the country of origin, plausibility of explanations offered by the customer, thresholds set by the categories of transaction.

33. In order to develop an understanding of the customers, banks shall apply customer enhanced due diligence measures, in addition to standard measures, in the following cases:
1) customers are not present personally for the identification (remote clients);
2) cross-border banking relationships (correspondent banking);
3) transactions or business relationships with politically exposed persons;
4) in case of business relationships and transactions carried out with individuals and legal entities, and financial institutions from the following countries and/or areas:
a) that do not have regulations against money laundering and terrorist financing, or have inadequate regulations in this regard;
b) represent a high risk due to high levels of crime and corruption;
c) where illegal manufacture of drugs may occur;
d) off-shore;
e) that are involved in terrorist activities;
f) on which sanctions, prohibitions or other restrictions were applied by national competent authorities andbased onthe acts issued by the international organizations in preventing and combating money laundering and terrorist financing.5) customers with accounts opened for investments and fiduciary asset management;
6) customers issuing bearer financial instruments, customers, professional participants on the securities market and other professional intermediaries such as pension funds, investment funds, lawyers, notaries that act for their customers.
7) customers that offer services linked with transfers of financial means (non-bank payment service providers through special cash-in devices, etc.);
8) electronic transactions, if there is insufficient information regarding the sender’s identity, as well as transactions that could favor the anonymity.
9) customers carrying out significant cash transactions;
10) customers whose ownership structure is complex;
11) customers benefiting from “private banking” services/products;
12) customers that make payments via payable through accounts, such as funds transfer transactions, which are transient transactions, including those conducting ​​under execution documents (writs of execution issued pursuant to the decisions of national and foreign courts, national and international arbitrations, decisions of bailiffs, etc.).

34. Customer enhanced due diligence measures implemented by the bank shall include:
1) enhanced and permanent monitoring of the business relationship, by increasing the number of controls and selecting the types of transactions that require additional examination, by requesting additional information that confirms the legality of transactions and their compliance with the type of activity declared;
2) special measures to establish or verify the source of funds;
3) implementation of information systems appropriate for information management, which enable the provision of timely information necessary to identify, analyze and effectively monitor the transactions, including reporting to the competent authority in accordance with the law. The IT systems shall allow at least finding of lack or insufficiency of relevant documents or information at the beginning of business relationship, unusual transactions (operations) carried out through customer's account and the aggregate situation of all customer transactions with the bank;
4) ensuring that the persons responsible for coordination of activities of services rendered to the respective customers know and pay attention to the information obtained from third parties in connection with these customers, and the responsible administrator approves the initiation or continuation of the business relationship with those customers;
5) in case of individuals – verification of employment, public offices held, if applicable;
6) warning customers, whose activities or transactions have a high risk of money laundering and terrorist financing, about the need to enhance the measures relating to developing an understanding with respect to their business partners and, where applicable, about the termination of business relationships or refusal to carry out operations with such customers. The requirements to develop an understanding of business partners are the same as those applied by the bank to its customers in accordance with this Regulation.
7) obtaining additional information about the customer, such as more frequent updating of information on the identity of the customer and the beneficial owner, nature of work expected to be carried out, nature of the business relationship expected to be carried out, the volume of assets and / or investments planned, the purpose of transactions conducted or planned to be carried out.
8) implementing effective control mechanisms and levers on regular reporting to the Office for Prevention and Combat of Money Laundering with regard to transactions of customers whose business meets one or more criteria for suspicion;
9) in case of cross-border relations, limitation or termination of the business relationship or carrying out the transactions, in case of non-compliance and inappropriate application of the requirements relating to preventing and combating money laundering and terrorist financing by partner bank;
10) additional measures referred to in items 35 – 39.

35. In the case stipulated in item 33 sub-item 1), banks shall conduct enhanced due diligence with respect to customers who are not able to present themselves personally for identification (for example, in case of relationships by post or telephone, e-mail, Internet or other electronic means), by using mechanisms as digital signatures, biometric methods, session keys, etc. At the first visit of the customer at the bank, the bank shall require the documents and information required by this Regulation. In addition, the bank shall apply one or more of the following measures:
a) require customer identification documents issued by a responsible authority or body, including a specimen of signatures, other documents, if necessary, to complete the customer’s file;
b) take measures to protect the authenticity of documents sent electronically to the bank;
c) use the information provided by a bank where the customer has opened an account and to apply at least the same know-your-customer measures and to be subject to an effective supervision;
d) require that the first payment to be made on behalf of customer through an account at another bank, which applies at least the same know-your-customer measures and is subject to an effective supervision, if necessary;
e) establish and maintain a way of contacting the customer, independent of the procedure of conducting transactions with the remote customers.

36. In correspondent relationships, banks shall accumulate sufficient information about the correspondent bank (institution, organization) to fully understand the scope of its activity. To this end, the bank shall:
1) obtain at least information on:
a) board and executive body of the correspondent bank, its most important activities, their place and measures applied to prevent and combat money laundering and terrorist financing;
b) purpose for opening the account;
c) correspondent bank's reputation and quality of supervision, including whether it was the subject of investigations or remedial actions related to money laundering or terrorist financing, from publicly available sources;
2) assess the adequacy and effectiveness level of policies of the correspondent bank on preventing and combating money laundering and terrorist financing;
3) establishing the correspondence relationship after obtaining the approval of the bank’s administrator;
4) establish documentarily the responsibilities of the correspondent bank in preventing and combating money laundering and terrorist financing and the fact that the correspondent bank shall verify the identity of its customers and shall have effective know-your-customer rules;
5) elaborate arrangements that allow bank to verify the procedures of the correspondent bank applied for know-your-customer purposes and send / receive, upon request, documents and information related to customers activity and their transactions.

37. In the business relationships or transactions with politically exposed persons, the bank shall apply at least the following measures:
1) to have a risk management system that:
a) allows to determine whether a customer, a potential customer and / or its beneficial owner is or is not a politically exposed person;
b) supposes to require relevant information from the client and / or its beneficial owner, the existence of a reference to a source of information publicly available or access to a commercial electronic database with information about the politically exposed persons;
2) to obtain the approval of the executive member of the bank (branch manager) to establish business relationship, and if the customer or its beneficial owner became later a politically exposed person - to continue the business relationship;
3) to establish the source of funds and other property involved in the business relationship or transaction;
4) to request information on family members and persons associated with the politically exposed person at the same intensity as the bank indentifies its customers in accordance with this Regulation;
5) to monitor increasingly and permanently the business relationship, including regularly updating the information about the customer and / or its beneficial owner of the politically exposed person.

38. If the customer establishes the business relationship with the purpose of investing and managing fiduciary asset, the bank shall identify the person in whose behalf the business relationship is established, the beneficiary on whose behalf the person acts, and shall determine the details of the nature of existing arrangements. The identification measures shall also include the founders of fiduciary administration, any other person who handed over assets in fiduciary management, any beneficiary of the fiduciary administration and any person entitled to dispose of the property.

39. If the customers who act for others, referred to in item 33 sub-item 6), do not have the right to provide bank the necessary information regarding the beneficial owners, the bank shall not open another account or establish another business relationship.

 

Chapter V
REPORTING OF ACTIVITIES AND TRANSACTIONS

40. Banks are obliged to inform the Office for Prevention and Combating Money Laundering about:
1) any suspicious activity or transactions involving money laundering and terrorist financing in preparation, progress or already made - immediately but not later than 24 hours;
2) activities or transactions made in cash through an operation with a value of at least MDL 100000 (or its equivalent) or through more cash operations that appear to be a connected between them - within 10 days working;
3) activities or transactions carried out by transfer, through an operation with a value that equals or exceeds MDL 500000 - not later than the 15th of the month following the reporting month.
the operations conducted among banks/financial institutions are exempted from the reporting regime, as well as those between banks/financial institutions and National Bank of Moldova, between banks/financial institutions and State Treasury, between the National Bank of Moldova and the State Treasury and the operations of collecting fees from servicing bank accounts and bank charges. For the purposes of this paragraph, the term “bank/financial institution” includes only reporting entities under the Law on preventing and combating money laundering and terrorist financing.

41. The bank shall have:
a) clear procedures, based on the Law on preventing and combating money laundering and terrorist financing, known to all employees, which provide for reporting by employees of all suspicious activities and transactions;
b) systems to detect suspicious activities and transactions according to criteria established by the competent authorities;
c) procedures for informing the executive and internal security services on issues related to preventing and combating money laundering and terrorist financing.

42. Banks shall inform, where appropriate, the National Bank or other authorities empowered to supervise the reporting entities in accordance with the Law on preventing and combating money laundering and terrorist financing, on suspicious activities and transactions, fraud affecting essentially the safety, stability or reputation of banks.

 

Chapter VI
DATA STORAGE

43. Banks shall keep the obtained documents and information relating to the identified customers and beneficial owners and their transactions (operations) at least five years after the business relationship is terminated or the account is closed. At the same time, banks shall keep the documents and information obtained related to identification of customers and beneficial owners, as well as that related to their transactions (operations) for the active period of the business relationship. Banks shall also keep record of the transactions (operations) for the period of five years after their termination.

44. Procedures for storing the documents and information shall include at least the followings:
1) keeping a register of identified customers and beneficial owner, containing at least: name / customer name, tax code, account number, opening date, closing date);
2) keeping all primary documents, including business correspondence;
3) keeping records on identification and verification of customers and beneficial owners regarding the monitoring of operations of customers and keeping the supporting documents related to the operations;
4) keeping information about transactions, including those complex and unusual;
5) archiving the information about transactions and business correspondence in IT systems and keeping the archive in a safe and available place;
6) when performing foreign exchange operations in cash with individuals through foreign exchange bureaus, banks shall apply the provisions related to record keeping in accordance with the Regulation on foreign exchange entities, approved by the Decision of the Council of Administration of the NBM no.53 of 5 March 2009.

45. Banks shall ensure that the documents and information related to the identification and verification of customers and beneficial owners, those related to monitoring of customers operations, including supporting documents related to the operations, are accessible and available to the competent authorities when requested. At the request of the competent authorities, the term regarding the possession and storage of the information relating to customers and their operations may be extended for a period specified in the request.

 

Chapter VII
INTERNAL CONTROL

46. To ensure the observance of programs to prevent and combat money laundering and terrorist financing, banks shall have an internal control system that ensure continued compliance of banks with the normative acts and the internal program in this sense and will contribute to minimization of the relating risks.

461. At the opening of branches and subsidiaries in other countries and during their activity, banks shall apply the requirements to prevent and combat money laundering and terrorist financing in accordance with their internal control system, internal policies and procedures and normative acts of the Republic of Moldova, which implement the FATF Recommendations, to the extent the host country legislation allows that. If the host country requirements to prevent and combat money laundering and terrorist financing are insufficient, banks shall ensure the implementation of requirements referred to in the normative acts of the Republic of Moldova, to the extent the law the host country legislation allows that. If the host country does not allow the proper implementation of the requirements of normative acts of the Republic of Moldova, banks shall apply the appropriate additional measures to minimize the risk of money laundering and terrorist financing and inform the NBM about this fact within two months. National Bank may conduct additional inspections to supervise the observance by branches and subsidiaries opened in other countries of the normative acts in this regard, and in case of non-compliance, the NBM may limit the activity or withdraw the authorization issued to open branches and subsidiaries in other states.

47. The internal control system shall include at least the followings:
1) conducting an audit by bank employees or by an independent person to verify the observance of programs to prevent and combat money laundering and terrorist financing. Audit functions for this purpose are:
a) independent evaluation of programs on preventing and combating money laundering and terrorist financing and observance with the requirements of legislation in force;
b) monitoring employees activity by testing their compliance;
c) testing of transactions, if necessary;
d) informing the executive body on the results of verification;
2) appointment of an administrator from bank's executive body, responsible for ensuring compliance of programs to prevent and combat money laundering and terrorist financing with the requirements of legislation and their appropriate application (hereinafter the responsible administrator). To this end, the responsible administrator shall have the following duties:
a) provide consultations to bank employees on issues that arise during the implementation of programs on preventing and combating money laundering and terrorist financing, including on the identification and examination of bank customers and assessment of risk of money laundering and terrorist financing;
b) take decisions based on the received information;
c) take measures regarding the reporting of information to the competent authority to prevent and combat money laundering and terrorist financing, in accordance with the law;
d) organize training for bank employees in preventing and combating money laundering and terrorist financing;
e) present in writing, at least yearly, to the bank’s Board a report on implementation of programs on preventing and combating money laundering and terrorist financing;
f) cooperate with the audit service to fulfill its purpose of verifying the compliance of bank's activity with the legislation to prevent and combat money laundering and terrorist financing;
g) perform other functions in accordance with this Regulation and internal bank documents;
3) internal provisions on liability of employees who intentionally fail to report suspicious activities or transactions to the responsible person, security service or directly to the competent authority and / or personally contributes to the operations of money laundering and terrorist financing.
4) performance of the bank, at least every four years, an analysis or report, in writing, which involves identifying and assessing risks relating to money laundering and terrorist financing and taking measures to mitigate the risks identified. When identifying risks, banks shall take into account the risk factors, such as customers, countries and geographical areas, products, services and transactions. Identification and risk assessment measures shall be proportionate to the size, complexity, nature and volume of banking activity. The report or analysis performed shall be approved by the administrator of the bank executive body, responsible for ensuring the compliance of programs on preventing and combating money laundering and terrorist financing and shall be submitted to the bank’s Board.

48. Banks shall have training and selection programs for employees with regard to preventing and combating money laundering and terrorist financing.

49. The training programs specified in item 48 shall include various aspects of the process of preventing and combating money laundering and terrorist financing and the duties under legislation, including:
a) training the new employed personnel on the importance and basic requirements of those programs;
b) training the “first line” personnel (employees who are directly in contact with customers) on the verification of the identification of new customers, monitoring the customers accounts existing on an ongoing basis, finding the indices and reporting the suspicious activities and transactions and those subject to reporting;
c) regular updating of employees responsibilities;
d) new techniques, methods and trends of money laundering and terrorist financing;
e) involvement of employees in preventing and combating money laundering and terrorist financing.
The content and schedule of employees training shall be adjusted to individual needs of the bank.

 

Chapter VIII
SANCTIONS AND REMEDIAL MEASURES

50. If there is violation of the requirements of this Regulation, the obligations under the Law on preventing and combating money laundering and terrorist financing, the National Bank of Moldova may impose sanctions and remedial measures in accordance with Article 38 of the Law on Financial Institutions.

51. In order to eliminate the breaches and shortcomings found and the conditions that favor their commission, the National Bank of Moldova, in addition to the sanctions and remedial measures referred to in item 50, may order the following measures:
a) to prescribe a change in programs to prevent and combat money laundering and terrorist financing;
b) to prescribe customer enhanced due diligence measures for products, services, transactions (operations) or customers where the programs on preventing and combating money laundering and terrorist financing establish the application of standard “know-your-customer” measures;
c) to prescribe the replacement of the responsible administrator.