Compliance Guidelines:

Regulatory Body of Afghanistan

The major AML regulatory body in Afghanistan is:

FinTRACA (Financial Transactions and Reports Analysis Center of Afghanistan): Afghanistan’s national financial intelligence unit responsible for combating money laundering and terrorism financing. It collects, analyzes, and disseminates financial intelligence to law enforcement and regulatory agencies to enhance the nation’s ability to respond to financial crimes.

Anti-Money Laundering and Proceeds of Crime Law

Article 11

• Reporting entities must assess and document money laundering and terrorism financing risks, including for new products or technologies.
• Enhanced due diligence is required for higher risks or suspicions.
• Simplified due diligence can be used for lower risks.

Article 12

• Reporting entities must identify and verify customer identities under specific circumstances like opening an account, significant transactions, suspicions, or if previous data is doubted.
• Identification methods differ for natural persons, legal persons, and legal arrangements.
• Due diligence is ongoing and considers risks, the purpose of business relationships, and transaction scrutiny.
• Specific measures for accounts or relationships without physical presence for identification are needed.
• Enhanced measures are required for high-risk countries or situations.
• Additional measures for life insurance or other investment-related businesses are stipulated.
• Financial groups must implement AML/CFT programs.
• Financial institutions should ensure foreign branches follow AML/CFT measures.

Article 13

• If a reporting entity cannot meet identification requirements or doubts remain, they should not proceed with the account or transaction and must report suspicions to the Financial Intelligence Unit (FIU).

Article 14

• Enhanced due diligence is needed for complex or unusual transactions.
• Transactions with entities from countries with insufficient AML/CFT measures require additional scrutiny.
• Reporting entities need to report suspicious transactions to the FIU and maintain records.

Article 15

• For politically exposed persons (PEPs) as customers or beneficial owners, reporting entities must:
  • Assess PEP status with risk management systems.
  • Secure senior management approval for business relationships.
  • Determine the source of funds or properties.
  • Implement enhanced ongoing monitoring.
• Above point applies to PEPs with prominent international organization roles when identified as higher risk.

Article 16

• Reporting entities must maintain transaction records for at least five years.
• Customer due diligence records, including identity verifications, must be retained for at least five years after the end of the business relationship.
• A centralized database may be required by supervisory authorities for recording data on customers, transactions, and suspicions.

References:

1. Da Afghanistan Bank