Skip Ribbon Commands
Skip to main content

Main page




Visitor Centre
Legislation and Policy Database

How to use SOAP functions to get information about CBA rates Function description

COMBATING MONEY LAUNDERING AND TERRORISM FINANCING

Frequently Asked Questions

On Rules for Filling in the Reporting Form 101

    1. Reporting on currency exchange transactions
    2. Reporting on parties to transaction
    3. Language of filling in names/ titles
    4. Calculation of deposit term
    5. Subject of electronic mail accompanying a report
    6. Use of brackets
    7. Filling in digital information
    8. Change of Deposit Currency
    9. Filling in parties to the transaction in cases of cash deposit on account by third party or of cash withdrawal from account by third party when reporting such transactions
    10. Filling in the amount for currency exchange transactions
    11. Reporting on increased deposit
    12. Reporting on accrued interest on deposit
    13. Reporting on several transactions below 20 million Armenian drams
    14. Filling in STRs on suspicious business relationships
    15. Reporting on several deposits below 20 million Armenian drams
    16. Early termination of deposit
    17. Reporting on transactions in different currencies
    18. Reporting on transactions between head office and branches

On Reporting Obligation of Notaries under the Republic of Armenia Law on Combating Money Laundering and Terrorism Financing

On Application of Certain Provisions of the Republic of Armenia Law on Combating Money Laundering and Terrorism Financing  

    1. Reasonable timeframe for identification and verification of identity
    2. Periodicity of updating CDD data
    3. Application of CDD measures to existing customers
    4. Establishment of Beneficial Ownership
    5. On the information to be included in the payment order by the financial institution ordering a wire transfer
    6. On the first payment of non-face to face relationships
    7. On STR related information sharing within the financial group

 

On Reporting Obligation and Customer Due Diligence Requirements 

    1. Calculation of Reporting Term
    2. Reporting on loans from financial institutions
    3. Reporting on transactions with Government T-bills
    4. Reporting of transactions with statutory capital
    5. Exceptions from reporting requirement for financial institutions
    6. Risk rating of domestic PEPs
    7. Risk rating of non face-to-face transactions
    8. Qualification of compliance officers of credit associations

  

On Rules for Filling in the Reporting Form 101

1: Reporting on currency exchange transactions

Up

Question: In cases when two accounts in different currencies are used for intra-bank spot transactions or for currency exchange, which account number should be entered in the field “Bank account number or unique reference code”?

Answer: The account number for the currency being sold should be entered in the field “Bank account number or unique reference code”.

 

2: Reporting on parties to transaction

Up

 Question: In cases when a natural person concludes a transaction on behalf of a legal entity for which he/she is not the authorized person, and the legal entity is not a customer of the bank, what are the rules for filling in the respective fields of the report on above-threshold or suspicious transaction/ business relationship?

Answer: The natural person should be indicated as a party to the transaction, and his/her identification data should be filled in the respective fields, whereas the name of the legal entity and other data on the transaction should be filled in the field 4.5 “Other information considered important on the transaction”.

 

3: Language of filling in names/ titles

Up

 Question: When should be the name/surname of the natural person or the name of the legal entity (under Section 5, “Parties to transaction”) filled in English (or in Latin letters)?

Answer: These fields should be filled in English (or in Latin letters) only in cases, when the respective data is available to the bank in English (or in Latin letters).

 

4: Calculation of deposit term

Up

 Question: In the field 5.2.2 “Term of deposit”, what are the rules for calculating the term?

Answer: The term in the field 5.2.2, “Term of deposit” is calculated in days.

 

5: Subject of electronic mail accompanying a report

Up

 Question: When submitting reports via the Lotus Notes system, what should be filled in the field “Subject” of the electronic mail?

Answer: The field “Subject” of the electronic mail should contain the indication “Reports to the Financial Monitoring Center”.

 

6: Use of brackets

Up

 Question: Should quotation marks be used when filling in text fields?

Answer: No, text fields should be filled in without quotation marks.

 

7: Filling in digital information

Up

 Question: Should the fields containing digital information be filled in whole numbers or the quotient should also be indicated?

Answer: In the fields “Amount of currency bought”, “Amount of currency sold”, “Amount in the given currency”, and “Equivalent amount in Armenian drams” figures should be filled in whole numbers without the quotient.

 

8: Change of Deposit Currency

Up

 Question: In cases when a currency exchange transaction is concluded under a multi-currency deposit agreement, what are the rules for filling in the reporting form?

Answer: When a currency exchange transaction is concluded under a multi-currency deposit agreement, the field 5.4 “Currency exchange” and its relevant data should be filled in, whereas in cases when, in addition to the exchange of currency, the interest rate for the deposit was also changed, a respective note should be entered in the field 4.5 “Other information considered important on the transaction”.

 

9: Filling in parties to the transaction in cases of cash deposit on account by third party or of cash withdrawal from account by third party when reporting such transactions

Up

 Question: Who is indicated as a costumer and a counterparty to the transaction in cases of selection of the fields “Cash deposit on account by third party” or “Cash withdrawal from account by third party” provided by point 4.2 of the reporting form?

Answer: In cases of selecting the fields “Cash deposit on account by third party” or “Cash withdrawal from account by third party” provided by clause 4.2 of the reporting form, i.e. in all cases when cash deposit on account or cash withdrawal from account is conducted by the person other than the authorized person (the latter mainly refers to cheque related transactions), the person who deposits on the account or withdraws from the account should be selected as “Transaction counterparty”. The person on whose account cash is deposited or from whose account cash is withdrawn should be selected as “Customer”.

 

10: Filling in the amount for currency exchange transactions

Up

 Question: What are the rules for filling in the fields 4.3 “Amount in original currency” and 4.4 “Amount in equivalent Armenian drams”, when under a currency exchange transaction the bank: 1. Sells Armenian drams and buys foreign currency; 2. Sells foreign currency and buys Armenian drams; 3. Converts one foreign currency into another.

Answer: When under a currency exchange transaction the bank: 1. Sells Armenian drams and buys foreign currency, the amount in Armenian drams (the currency sold) should be filled in the field 4.3 “Amount in original currency”. In this case, the same amount shall be filled in also in the field 4.4 “Amount in equivalent Armenian drams”; 2. Sells foreign currency and buys Armenian drams, the amount in the foreign currency (the currency sold) should be filled in the field 4.3 “Amount in original currency”. In this case, the Armenian dram equivalent of the transaction amount shall be filled in the field 4.4 “Amount in equivalent Armenian drams” at the average exchange rate in the currency market as published by the Central Bank; 3. Coverts one foreign currency into another, the amount in the sold foreign currency should be filled in the field 4.3 “Amount in original currency”. In this case, the Armenian dram equivalent of the bought currency shall be filled in the field 4.4 “Amount in equivalent Armenian drams” at the average exchange rate in the currency market as published by the Central Bank.

 

11: Reporting on increased deposit

Up

 Question: If the customer has an accrual deposit with a specific term of maturity and, for example, in one year after the initial deposit increases its amount by 25 million Armenian drams, what should be the term indicated in the report on increasing the amount of the deposit?

Answer: In this case the report on increasing the amount of the deposit should contain the field 5.2.2 “Term of deposit” indicating the term which if left until the repayment of the deposit as of the moment of increasing its amount.

 

12: Reporting on accrued interest on deposit

Up

 Question: In cases when the amount of repaid deposit is below the reporting threshold, but the sum total of the repaid deposit and the accrued interest is above that threshold, does this require filing report on over-threshold transaction with the Financial Monitoring Center?

Answer: No, the amount of accrued interest is not summed up with the amount of the deposit, and in cases when this sum total is above the reporting threshold there is no need to file a report on over-threshold transaction with the Financial Monitoring Center

 

13: Reporting on several transactions below 20 million Armenian drams

Up

 Question: If the account of a legal entity is debited for an amount above the threshold of 20 million Armenian drams to be credited on several other accounts in amounts individually below the said threshold, does this require filing a report on over-threshold transaction with the Financial Monitoring Center?

Answer: In cases when the account of a legal entity is debited for an amount above the threshold of 20 million Armenian drams to be credited on several other accounts in amounts individually below the said threshold and channeled to the payment of salaries, communal service fees or other similar purposes, there is no need to file a report on over-threshold transaction with the Financial Monitoring Center. This does not apply to the cases when the account of a legal entity is debited for an amount above the threshold of 20 million Armenian drams to be transferred to other legal entities in one or several transactions (including cross-border wire transfers).

 

14: Filling in STRs on suspicious business relationships

Up

 Question: If a suspicious transaction report is filed with the Financial Monitoring Center on a business relationship as opposed to that on a specific transaction, what should be filled in the respective fields of the reporting form on the amount and the currency of the transaction?

Answer: When a suspicious transaction report is filed, and the amount of the transaction cannot be specified, then zero (“0”) should be entered in the fields 4.3 “Amount in original currency” and 4.4 “Amount in equivalent Armenian drams”.

 

15: Reporting on several deposits below 20 million Armenian drams

Up

 Question: When the customer makes a deposit or increases it in amounts individually below the threshold of 20 million Armenian drams, does this require filing a report on over-threshold transaction with the Financial Monitoring Center?

Answer: If a deposit below the threshold of 20 million Armenian drams is increased by an amount below the said threshold, then even if the sum total of the deposit happens to be above the threshold, this does not need to be reported to the Financial Monitoring Center. Nevertheless, the cases when deposits are repaid and/or the respective amounts are received by customers having built up such deposits above the reporting threshold of 20 million Armenian drams should be reported to the Financial Monitoring Center. Above-threshold transaction reports are not filed also in cases when the term of maturity for built up deposits is extended.

 

16: Early termination of deposit

Up

 Question: What are the rules for indicating the term in the field 5.2.2 “Term of deposit” in case of early termination of a deposit agreement?

Answer: In case of early termination of a deposit agreement, zero (“0”) should be entered in the field 5.2.2 “Term of deposit”.

 

17: Reporting on transactions in different currencies

Up

 Question: What are rules for filling in the reporting form when the customer having a US dollar account with the bank receives an amount in euros above the equivalent of 20 million Armenian drams?

Answer: In cases when the customer having a US dollar account with the bank receives an amount in euros above the equivalent of 20 million Armenian drams, while he/she does not have a euro account, and the received amount is subject to conversion based on a respective agreement between the customer and the bank, on a written contract or on usual business practice, then two reports should be filed with the Financial monitoring Center. The first report should be filed on the receipt of funds to the account, while indicating in the field “Bank account number or unique reference code” the number of the transit account credited with euros. The second report should be filed on the conversion of currency, while indicating in the field “Bank account number or unique reference code” the number of the US dollar account credited with the converted amount.

 

18: Reporting on transactions between head office and branches

Up

 Question: In cases when a credit organization transfers funds from its account to that of its branch, does this constitute an exception from the obligation to report above-threshold transactions?

Answer: Transfers between the accounts of the credit organization and its branches are considered as relocation of own funds of the financial institution, which does not require filing a report on over-threshold transaction with the Financial Monitoring Center.

 

 

On Reporting Obligation of Notaries under the Republic of Armenia Law on Combating Money Laundering and Terrorism Financing

Up

According to Part 1, Article 5 of the Republic of Armenia Law on Combating Money Laundering and Terrorism Financing (hereinafter: the Law), reporting entities shall file a report to the Authorized Body on any of the following transactions:

1) Transactions above the threshold of 20 million Armenian drams, excluding the transactions stipulated by Clause 2 of this Part;

2) Transactions related to real estate above the threshold of 50 million Armenian drams;

3) Suspicious transactions or business relationships, regardless of the amount stipulated by this Part.

The reporting obligation defined under Part 1 of the said article applies to notaries only with regard to the following transactions prepared or carried out for their clients (Clause 3, Part 2, of Article 5 of the Law):

a) Buying and selling of real estate; this does not apply to transactions for pledging of real estate as collateral. At the same time, if the contract to be verified is on buying and selling of real estate and on pledging (mortgage) of that property on behalf of a third party as a collateral  (security for the repayment of debt), then a report should be filed on the said contract. As far as the instruments providing for an advance payment or prepayment are concerned

  • If a separate contract on the advance payment or prepayment is concluded above the established threshold of 50 million Armenian drams in the meaning of the reporting requirement under Clause 2, Part 1 of Article 5 of the Law, this shall require filing of a separate report by indicating in the field 1.4 “The nature of transaction” provision of advance payment or prepayment as the subject of the transaction. In such cases, a separate report shall be filed also upon the verification of the contract providing for a full payment of the contract price; 

  • If the provision on the advance payment or prepayment is included in the main contract on buying and selling of real estate, and the price of the contract is above the established threshold of 50 million Armenian drams in the meaning of the reporting requirement under Clause 2, Part 1 of Article 5 of the Law, this shall require filing of one report only;

b) Managing of client money, securities, or other assets; for example:

  • Acceptance of deposits or maintenance of monetary funds or securities by the notary;

  • Contracts providing for trust management, borrowing or otherwise managing property;

  • Powers of attorney providing for the management of client property (including monetary funds or securities);


In the meaning of the reporting requirement under Clauses 1 and 2, Part 1 of Article 5 of the Law, reports should be filed only in cases when the transaction specifies a price (value) above the established reporting threshold;

c) Management of bank and securities accounts; for example powers of attorney for transactions with the accounts of other natural persons or legal entities.

In the meaning of the reporting requirement under Clause 1, Part 1 of Article 5 of the Law, reports should be filed only in cases when the transaction specifies a price (a maximum limit on the amount of transactions) above the established reporting threshold;

d) Provision of funds or other assets for establishment, operation, or management of legal persons; for example:

- Articles of incorporation of legal entities;
- Contracts on extending loans or providing other assets to legal entities for facilitating their regular operations.

In the meaning of the reporting requirement under Clauses 1 and 2, Part 1 of Article 5 of the Law, reports should be filed only in cases when the transaction specifies a price (value) above the established reporting threshold;

e) Performing functions of establishment, operation, or management of legal persons, as well as alienation (acquisition) of contributions, shares and the like in the authorized capital (equity capital and the like) of legal persons, or alienation (acquisition) of stocks (equities, shares) of legal persons at a nominal or market value; which, in addition to the cases stipulated under the point “d” above, also include transactions for making investments in or alienating shares of the statutory capital of  legal persons.


In the meaning of the reporting requirement under Clauses 1 and 2, Part 1 of Article 5 of the Law, reports should be filed only in cases when the transaction specifies a price (nominal or market value) above the established reporting threshold.

 

 

 

On Application of Certain Provisions of the Republic of Armenia Law on Combating Money Laundering and Terrorism Financing

 

1: Reasonable timeframe for identification and verification of identity

Up

 Question: According to Article 15 of the Republic of Armenia Law on Combating Money Laundering and Terrorist Financing (hereinafter: the Law), the requirements on customer identification and verification of identity are allowed to be implemented also in the course of establishing a business relationship or concluding an occasional transaction or thereafter, within a reasonable timeframe. How this reasonable timeframe is determined?

Answer: Article 15 of the Law defines that the requirements on customer identification and verification of identity are allowed to be implemented also in the course of establishing a business relationship or concluding an occasional transaction or thereafter, within a reasonable timeframe, provided that the risk of money laundering or terrorism financing has been effectively prevented, and that this is necessary in order not to impair the normal business relationships. Based on the findings of the comparative analysis of the international practice and the practical experience on application of reasonable timeframes, customer identification and verification of identity should be conducted as soon as possible and in any case not later than 7 days after establishing the business relationship or concluding the occasional transaction. Further details on the reasonable timeframe may be prescribed by internal legal acts of reporting entities. In cases when customer identification and verification of identity are conducted after establishing a business relationship or concluding an occasional transaction, the necessary measures as specified by relevant internal legal acts should be undertaken to assure that ML/TF risks are effectively prevented.

 

2: Periodicity of updating CDD data

Up

 Question: How often the data obtained due to customer identification in the business relationship should be updated?

Answer: According to Article 16 of the Law, the periodicity of updating data obtained due to customer identification in the business relationship is determined by reporting entities. For the sake of ensuring that the above-mentioned data is kept up-to-date, it is recommended that at least an annual periodicity for the updating requirement is established.

 

3: Application of CDD measures to existing customers

Up

 Question: Do the customer due diligence requirements apply to the customers that existed before the adoption of the Law?

Answer: Yes they do. Implementation of the customer due diligence requirements to the customers that existed before the adoption of Law should be based on materiality and risk pertinent to each customer.


 4: Establishment of Beneficial Ownership


Question: When considering the requirements under Clause 2, Part 5 of Article 16 and Parts 1 and 2 of Article 27 of the Republic of Armenia Law on Combating Money Laundering and Terrorism Financing, as well as the requirements under Part 1 of Article 9 of the Republic of Armenia Law on Combating Money Laundering and Terrorism Financing, Part 3 of Article 66 and Part 4 of Article 36 of the Republic of Armenia Law on State Registration of Legal Entities, State Recordkeeping of Separated Divisions of Legal Entities, Enterprises and Sole Proprietors, what shall reporting entities do to identify and (or) verify the identity of the beneficial owner of a legal entity, including in case of an indefinitely long chain of legal entities?

Answer: Part 5 of Article 16 of the Republic of Armenia Law on Combating Money Laundering and Terrorism Financing (hereinafter referred to as the Law) stipulates that reporting entities should determine whether the customer is acting on behalf and (or) for the benefit of another person. Reporting entities should “establish any beneficial owner and, as applicable, identify the beneficial owner and verify his identity, in accordance with Parts 1 to 4 and Part 8 of this Article”.

This requirement is driven by FATF Recommendations 10 and 22, which specify that reporting entities should – as part of customer due diligence process – identify beneficial owners and undertake adequate measures to verify the identity of the beneficial owner, thus ensuring that they have information of beneficial ownership. In particular, when a customer is a legal person or arrangement, reporting entities should have information on those who own and control the customer involved.

According to Part 1 of Article 9 of the Law, in case of registering a legal person the founders shall be obligated to file a declaration on the beneficial owners of the legal person with the state authority in charge of registering legal persons (hereinafter referred to as the State Registry). Moreover, pursuant to Part 3 of Article 66 of the Republic of Armenia Law on State Registration of Legal Entities, State Recordkeeping of Separated Divisions of Legal Entities, Enterprises and Sole Proprietors, in case of making changes in the statutory capital or in the composition of the shareholders, legal persons shall be obligated to file with the State Registry a declaration on beneficial owners as prescribed by the Law.

This requirement stems from the FATF Recommendation 24 defining that countries should ensure that there is adequate, accurate and timely information on the beneficial ownership and control of legal persons.

2014 FATF Guidance on Transparency and Beneficial Ownership (hereinafter referred to as the Guidance) reflects on the identification of beneficial owners of legal persons, with its Clause 32 defining the successive steps to be taken by reporting entities (and by the State Registry). Particularly, financial and non-financial institutions should identify and verify the identity, and the State Registry should establish:

  1. The identity of the natural persons (if any, as ownership interests can be so diversified that there are no natural persons, whether acting alone or together, who exercise control of the legal person through ownership) who ultimately have a controlling ownership interest in a legal person; and
  2. To the extent that there is doubt as to whether the persons with the controlling ownership interest are the beneficial owners, or where no natural person exerts control through ownership interests, the identity of the natural persons (if any) exercising control of the legal person through other means;
  3. Where no natural person is identified under (1) or (2) above, the relevant natural person who holds the position of senior managing official.

Hence, in all cases where it is impossible to identify and (or) verify identify of the natural persons specified in (1) and then in (2), FATF Recommendations allow to stop in the process of identifying and (or) verifying identity of the beneficial owners of the legal person once the identity of the natural person acting as the senior managing official of the legal person has been established. It is worth mentioning that Clause 14, Part 1 of Article 3 of the Law stipulates that a member of the management and (or) executive body of a legal entity can also be recognized as the beneficial owner.

2014 FATF Guidance on Transparency and Beneficial Ownership stipulates the natural persons who may exercise control through positions held within a legal person. Such are natural person(s) responsible for strategic decisions that fundamentally affect the business practices or general direction of activities of the legal person; or natural person(s) who exercise(s) executive control over the daily or regular affairs of the legal person through a senior management position, such as a chief executive officer (CEO), chief financial officer (CFO), managing or executive director, or president[1​].

More details around the clarifications provided in the Guidance can be found at http://www.fatf-gafi.org/media/fatf/documents/reports/Guidance-transparencybeneficial-ownership.pdf​.

In case the last step in the succession of measures undertaken does not lead to a positive result, then financial and non-financial institutions should refuse the transaction or business relationship and consider recognizing it suspicious as prescribed under Parts 1 and 2 of Article 27 of the Law, and the State Registry should refuse the registration as prescribed under Part 4 of Article 36 of the Republic of Armenia Law on State Registration of Legal Entities, State Recordkeeping of Separated Divisions of Legal Entities, Enterprises and Sole Proprietors.

[1] 2014 FATF Guidance on Transparency and Beneficial Ownership, pages 15-16


 5: On the information to be included in the payment order by the financial institution ordering a wire transfer

 Question: Regarding the requirement of Part 2 of Article 20 of the Republic of Armenia Law on Combating Money Laundering and Terrorism Financing, is the financial institution ordering a wire transfer obligated to include the entire information, which is obtained and maintained under Part 1(3) of Article 20, in the payment order accompanying the transfer? 

Answer: According to Part 2 of Article 20 of the Republic of Armenia Law on Combating Money Laundering and Terrorism Financing (hereinafter referred to as the Law):

“For all wire transfers, the ordering financial institution should include the information specified under Part 1 of this Article in the payment order accompanying the transfer”.

Part 1 of Article 20 of the Law, in turn, defines the scope of information that the financial institution ordering a wire transfer is obligated to obtain and maintain. In particular, among other data specified in Part 1 of Article 20 of the Law, the financial institution ordering a wire transfer is obligated to obtain and maintain also the details of the identification document for natural persons or individual identification number (state registration, individual record number etc.) for legal persons.

This requirement stems from the FATF Recommendation 16, which defines that in order to prevent terrorists and other criminals from having unfettered access to wire transfers for moving their funds, as well as to detect such misuse when it occurs, information accompanying wire transfers should always contain:

1)      The name of the originator;
2)      The originator account number where such an account is used to process the transaction;
3)      The originator’s address, or national identity number, or customer identification number, or date and place of birth;
4)      The name of the beneficiary; and
5)      The beneficiary account number where such an account is used to process the transaction.

Hence, the requirement of the FATF Recommendation 16 is that information accompanying wire transfers includes any of the below-stated data on the natural person who originates the transfer:

-       Address; or
-       National identity number; or
-       Customer identification number; or
-       Date and place of birth.

Consequently, the obligation of the ordering financial institution under Part 2 of Article 20 of the Law would be considered to be met if the payment order accompanying the wire transfer includes any of the above-specified identification data of the originator.

On Reporting Obligation and Customer Due Diligence Requirements 

6: On the first payment of non-face to face relationships

Up

 Question: Does the requirement stipulated by Clause 40 of the Regulation on Minimum Requirements to Reporting Entities in the Field of Preventing Money Laundering and Terrorism Financing (hereafter-Regulation), apply to cases, when the reporting entity based on the outcomes of a risk assessment, assesses a non-face to face business transaction or relationship as medium risk according to Clause 22.1 of the Regulation?

Answer: According to Clause 27 (6) of the Regulation, non-face to face business transactions or relationships are identified as ML/TF high-risk criteria, which means that enhanced costumer due diligence measures, should be applied by reporting entities.
As a mitigation measure related to the risk of the physical absence of the costumer, in addition to the enhanced due diligence measures, Clause 40 of the Regulation obliges reporting entities in case of non-face to face relationships to carry out the first payment through an account in the customer’s name with a financial institution, which meets the requirements defined under Sub-Clauses “a” to “c”, Clause 3, Part 8 of Article 16 of the Law.
This requirement stems from the FATF Recommendation 10, which also envisages it as a mitigation measure to high-risk business relationships.
Hence, in cases when the reporting entity conducts a risk assessment according to Clause 22.1, prescribes relevant mitigation measures related to the risk of physical absence of the costumer in its internal legal acts (i.e. limiting the amount of the transactions, restraining the groups of costumers using the product to only residents and physical persons, obtaining the costumer due diligence data from partner financial institution, etc.), consequently assesses a non-face to face business transaction or relationship as medium risk, and sends the outcomes of the assessment to the Financial Monitoring Centre of the Central Bank of Armenia as prescribed by the 4th Chapter of the Regulation, the application of the requirement prescribed by Clause 40 of the Regulation is not necessary.

 

7: On STR related information sharing within the financial group

Up

 Question: Does the requirement stipulated by the Clause 5, Article 6 of the AML/CFT law prohibit the members of the financial groups from information sharing on STRs?

Answer: Part 1 of Article 23 of the AML/CFT law provides that financial groups should have in place and apply group-wide internal legal statutes aimed at the prevention of money laundering and terrorism financing. Based on Clause 16, Part 1 of Article 23 financial groups should have procedures for sharing information within the group for the purpose of combating money laundering and terrorism financing, which also covers information sharing on STRs. This interpretation stems from the FATF recommendation 18 and 21, which envisage information sharing on STRs under the information shared for the purposes of AML/CFT and do not consider it as “tipping off”. Hence, the interpretation of the above-mentioned Articles of the AML/CFT Law requires the financial group members to share information on STRs and other AML/CFT related issues.

 

1: Calculation of Reporting Term

Up

 Question: What is the reference point of time for counting down the three-day period of filing an above-threshold report to the Financial Monitoring Center?

Answer: The reference point of time for counting down the three-day period of filing an above-threshold report is the next day of concluding the transaction to be reported. For example, if the transaction was concluded on Thursday March 4, the three-day period would start on Friday March 5. Here one has to take into consideration that the three-day period includes business days only; in our example, the three-day period would end on Wednesday March 10 (as March 8 is a non-working day).

 

2: Reporting on loans from financial institutions

Up

 Question: When a financial institution receives a loan from a bank or credit association, is that transaction reportable to the Financial Monitoring Center?

Answer: No, receipt of loans by financial institutions from banks or credit associations is not reportable to the Financial Monitoring Center.

 

3: Reporting on transactions with Government T-bills

Up

 Question: Does the purchase or sale of Government T-bills need to be reported to the Financial Monitoring Center?

Answer: When purchasing or selling Government T-bills, the transaction has to be reported to the Financial Monitoring Center only in case of secondary allocation; i.e. when the any of the two parties of the transaction is not a specialized entity.

 

4: Reporting of transactions with statutory capital

Up

 Question: Does the body in charge of registering legal entities (the State Registry) need to file a report with the Financial Monitoring Center on the sale or purchase of shares in the statutory capital of commercial companies, when any of the two parties of the transaction is a public authority?

Answer: Yes, the body in charge of registering legal entities (the State Registry) needs to file a report with the Financial Monitoring Center irrespectively of the fact whether any of the two parties of the transaction is a public authority.

 

5: Exceptions from reporting requirement for financial institutions

Up

 Question: When a financial institution has received or provided a loan, or when the statutory capital of the financial institution has been changed in an amount above 20 million Armenian drams, does the financial institution need to file an above-threshold report with the Financial Monitoring Center?

Answer: The exceptions from the reporting requirement for financial institutions are established by Clause 5 of the Guidance on Completion and Submission of the Reporting Form 001 as approved by the Decree of the Board of the Central Bank of Armenia No 231-N from July 31, 2008, as well as by Clause 9 of Annex 2 of the Rules for Registration of Banks, the Terms and Procedure for Submission of Above-Threshold and Suspicious Transaction Reports by Banks as approved by the Decree of the Board of the Central Bank of Armenia No 296-N from October 6, 2009 do not provide for the types of transactions in question. Therefore, financial institutions needs to file a report with the Financial Monitoring Center in cases when they receive or provide a loan, or when the statutory capital of the financial institution has been changed in an amount above 20 million Armenian drams.

 

6: Risk rating of domestic PEPs

Up

 Question: In relation to the persons who are or have been entrusted with prominent public, political or social functions in the Republic of Armenia, does the anti-money laundering and counter terrorist financing legislation require that such persons are considered as high-risk?

Answer: No, the Law on Combating Money Laundering and Terrorist Financing requires that the persons who are or have been entrusted with prominent public, political or social functions in a foreign country or state are considered as high-risk.

 

7: Risk rating of non face-to-face transactions

Up

 Question: Is it required that all non face-to-face transactions or business relationships are considered as high-risk?

Answer: Yes, according to Clause 22 of Regulation on the Minimal Requirements Stipulated for the Financial Institutions in the Area of Combating Money Laundering and Terrorist Financing, establishment of business relationships or occasional transaction without face-to-face communication is considered as high-risk, while Clause 2 of the same rules provides for the minimum additional measures that financial institutions should take when establishing business relationships or conducting occasional transactions in non face-to-face regime.

 

8: Qualification of compliance officers of credit associations

Up

 Question: Is there a requirement for internal compliance officers of credit associations to be qualified by the Authorized Body?

Answer: According to Clause 2 of Article 22 of the Law on Combating Money Laundering and Terrorist Financing, the staff of the internal compliance unit of reporting entities – including that of credit associations – shall pass qualification in the manner and based on the professional relevance criteria established by the Authorized Body. Part 1 of Article 11 of the same Law defines that the Authorized Body shall establish the minimal requirements for the qualification of internal compliance staff. Currently such minimal requirements are not established (except for those on banks’ compliance staff); therefore, the requirement for internal compliance officers of credit associations to be qualified by the Authorized Body is not in effect.

Previous

Electronic Government of the Republic of Armenia

Financial System Mediator

Armenian Deposit Guarantee Fund

Armenian Card

Armenian Motorinsurers’ Bureau

National Mortgage Company

ACRA Credit Reporting

German-Armenian Fund

Home for youth

Next