New law to tighten combating money laundering

Combating money laundering and financing of terrorism will be enhanced through new legislation coming into force from July.

The president on Wednesday approved the Act on the Combating Money Laundering and Financing of Terrorism and certain related acts, which implement the EU’s Fourth Anti-Money Laundering Directive and the EU Regulation on payer information accompanying transfers of funds.

Under the new law, the government, supervisory authorities, lawyers’ associations, entities with a statutory reporting obligation, and traders have a duty to prepare a risk assessment of money laundering and financing of terrorism.

The objective is for companies and other entities to base their measures aimed at combating money laundering and financing of terrorism more than at present on risk assessments. In practice, this could mean, for example, enhanced monitoring of some customers.

The legislation will enter into force on 3 July 2017. A transition period up to 31 December 2017 will apply to the risk assessment of entities with a statutory reporting obligation and to due diligence of politically exposed persons.

An obligation to register with a new supervision register maintained by the Regional State Administrative Agencies will enter into force on 1 July 2019.

The legislation also revised the powers of the supervisory authorities and lawyers’ associations as well as the Financial Intelligence Unit, the national anti-money laundering unit. The supervisory authorities include, for example, the Financial Supervisory Authority, the Southern Finland Regional State Administrative Agency, and the National Police Board.

Under the new legislation, the supervisory authorities may also prescribe administrative sanctions, such as penalty payments for failure to observe obligations.

The Financial Intelligence Unit has the right to suspend a suspicious transaction for 10 working days in contrast to the previous five working days.