Rada passes anti-money-laundering law (12/22/02)

Rada passes anti-money-laundering law

WASHINGTON - The law "On Prevention and Counteraction of Legalization (Laundering) of Proceed from Crime" was adopted by the Verkhovna Rada of Ukraine on November 28.

The Law is based upon the Strasburg Convention of 1990 on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime. The provisions of the bill reflect the requirements to internationally recognized 40 recommendations to counter money laundering and eight special recommendations on terrorist finance of the Financial Action Task Force (FATF). Thus the bill brings Ukraine's money-laundering legislation in line with world standards.

The bill specifically provides for the establishment of a two-tier financial monitoring system over significant and suspicious transactions, including mandatory suspicious activity reporting (SAR), setting the criteria for financial transactions to be subject to financial monitoring, and determining the tasks, functions and power of the Financial Intelligence Unit of Ukraine. The bill also defines liability for non-compliance with its provisions, and requires that relevant legislation be amended.

The adoption of the bill and its implementation are yet another step by Ukraine in international efforts to fight money laundering and the financing of terrorism.

The bill was drafted in close cooperation with experts of the World Bank and the International Monetary Fund as well as the U.S. departments of Justice and the Treasury.

With money laundering and other criminal activities rapidly taking on staggering international dimensions, cooperation between Ukrainian and U.S. law enforcement agencies is of tremendous importance. Upon taking effect, the bill will be a substantial means in addition to such bilateral instruments as the Mutual Legal Assistance Treaty of 1998 and the Convention on Laundering, Search, Seizure and Confiscation of the Proceeds of Crime of 1990, to track down criminals, bring them to justice and restore violated rights.

The law enforcement agencies of the two countries are heavily involved in investigating a series of money-laundering activities committed on the territory of both Ukraine and the United States. The result of such cooperation was already displayed in 2000, when the government of Ukraine received $1 million in compensation for damages inflicted by a U.S.-based company.

The bill expands the possibilities of the law enforcement agencies of Ukraine in their international efforts to fight money laundering, and prevent legalization of proceeds from crime.

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