Regmi promises passage of AML bills
KATHMANDU, JUN 03 -
Chairman of the Council of Ministers Khil Raj Regmi has pledged that the government will move ahead with the process of passing the Second Amendment to the Anti-Money Laundering Act 2008 and the Proceeds of Crime Bill.
After finance secretary Shanta Raj Subedi and Nepal Rastra Bank governor Yubaraj Khatiwada pressed hard for the passage of the two anti-money laundering bills warning that the country could otherwise be blacklisted by the Financial Action Task Force (FATF), Regmi said that the government would work for their enactment.
Speaking at an interaction held at the Finance Ministry during an inspection visit by Chairman Regmi on Sunday, Subedi and Khatiwada warned that blacklisting by the global anti-money laundering body could have a huge impact on the country’s image, its global transactions and the way Nepali nationals are treated by the international community.
The two bills have been sent to the Cabinet for its endorsement, and they are being studied by its bill committee. After the Cabinet okays the bills, they will be sent to the President for his endorsement after which they will become law. As the next plenary of the FATF is scheduled to start on June 17 in Oslo, Subedi said that the two ordinances should be passed this week to permit the Asia Pacific Group on Money Laundering (APG) to include Nepal’s progress in its assessment report.
He urged the government to take the issue seriously and ensure that the bills are passed within a week. “If Nepal were to be blacklisted, it can hurt foreign aid and the country’s banking transactions, and Nepalis will have to suffer different treatment on their foreign trips,” he added. According to him, Nepal has failed to comply with 11 out of the 16 FATF recommendations, and passage of the two ordinances will ensure compliance with 10 recommendations.
Meanwhile, governor Khatiwada said that the impact of a possible blacklisting would be unimaginable. “It will create hurdles in the country’s various transactions with the world,” he added.
Earlier, the FATF plenary had warned Nepal of being blacklisted during the next plenary if it failed to honour its commitments as the country has a history of failing to comply with FATF recommendations on time. The FATF has been insisting on first criminalizing money laundering activities effectively through legal measures.
The proposed amendment to the Anti-Money Laundering Act has provisioned increasing the scrutiny of the financial transactions of politically exposed persons (PEPs) in line with the FATF’s revised recommendations of 2012. It has defined PEP as a person who has held a position above the secretary level in the government.
As per the order of precedence recently prepared by the government, the President, Vice-President, Prime Minister, Chief Justice, Chairman of Parliament, ministers, lawmakers, army chief, chiefs of constitutional bodies, vice-chairman of the National Planning Commission, Nepal Rastra Bank governor and vice-chancellors of universities rank above the secretary level.
The amendment to the act has also proposed making customer due diligence (CDD) a requirement in case the amount being electronically transferred is more than Rs 75,000. The draft amendment will also define predicate offences of money laundering as a crime.
Similarly, the proposed Proceeds of Crime Bill has provisioned forming a separate entity to look after the assets confiscated from individuals allegedly involved in money laundering and terrorist financing activities. The office will have the authority to seize, freeze and confiscate illegally-earned property.
The proposed entity will be responsible for not only managing seized property suspected of having been acquired through money laundering activities, but also property that has been earned through predicate offences of money laundering such as corruption, organised crime, human trafficking and trafficking in endangered species.
Source: The Kathmandu Post
