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State Duma toughens cash control

Credit: Igor Zarembo | RIAN

Banks will be providing more data on corporate transactions involving cash to the Federal Service for Financial Monitoring – now that the State Duma (Russia’s lower house of parliament) has passed amendments to Federal Law 115 on money laundering, according to Uchyot.Nalogi.Pravo.

Currently, companies are not subject to additional monitoring if they carry out cash operations for economic purposes. The new version of the law will not contain the waiver any more.

Padva and Epshtein Law Firm Partner and Executive Director Anton Babenko believes that the majority of companies will not notice the changes. However, the number of monitored transactions is growing, which may result in more cases of bank account blocking.

The list of transactions subject to mandatory control under the law on prevention of money laundering is regularly expanded based on recommendations from FATF (Financial Action Task Force), an intergovernmental organization.

“Cash transactions monitoring has been toughened. From now on, all cash withdrawals and deposits of over RUR 600K ($8.5K) from and to corporate accounts will be under mandatory control by competent organizations and the Federal Service for Financial Monitoring. Earlier, the transactions subject to monitoring included transactions that did not correspond to the nature of a company’s activity,” the lawyer explains. “Additionally, for organizations operating money or other property, the list of reportable operations that may be suspected of money laundering has also been expanded. Now transaction information must include the name of a client’s beneficiary owner.”

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