The subject of anti-money laundering and know your customer in Turkey has experienced a rapid evolution in recent years, largely attributable to the initiative of the FATF.
The succession of the enactment of the various Turkish regulations, EU directives, and FATF guidelines, subsequently transposed by national legislation has meant that our country has equipped itself with an anti-money laundering system useful for the evidence and reporting of facts, deeds and financial movements that could recognize the purpose of laundering the proceeds of crime and terrorist financing.
Certainly MASAK regulations related to AML and CFT are to be considered the starting point of the most recent regulatory developments, laying the foundations for a new prevention model, intended to strengthen safeguards to combat economic crime.
The importance of this legislation lies in the provision of a new model that has become increasingly marked, which foresees and involves the role of the Professionals (accountants, accounting experts, labor consultants , notaries, lawyers, etc.) who, as subjects obliged, they are called to actively collaborate in the action to prevent the risk of money laundering and terrorist financing.
In light of the aforementioned regulatory measures, the legislator, first and then the national one, wanted to give ever more meaningful value to the fundamental principle of law such as transparency, which from the beginning has become an instrument of guarantee, which is requested from private individuals and public administration, which are subject to it as a real burden and obligation.
Over the past ten years, this regulatory process has consolidated the thinking that it is not possible to implement crime prevention and repression policies without introducing effective measures that guarantee an adequate level of transparency of the financial system.
Is it a solution Follow the Money?
There is no doubt that the ” follow the money ” principle that substantiates the timely interception of suspicious financial flows and money laundering activities is the most logical method of curbing and repressing terrorism and crimes in particular economic crimes.
Forcing professionals and the financial world to prevent ” disclosure ” for potentially risky transactions, also giving the benefit of anonymity to suspicious transaction reports ensures that operators and citizens are aware that these transactions will be subject to scrutiny by competent authorities and inspection bodies.
The forecast and obligations extended to financial intermediaries, real estate agents, art galleries, operators in the gaming sector or in the world of virtual currencies have greatly extended the level of attention to the phenomena that can conceal a hypothesis of crime attributable to the case envisaged and punished by the crime of money laundering.
There is no doubt that the knowledge of the customer ( Know Your Client in Turkey, KYC ) and the application of a procedure aimed at maintaining and monitoring the anti-money laundering measures represent a significant organizational effort for the professional, also associated, but on the other hand, it is a necessary effort to maintain high standards of consultancy, in a world that, in a few years, has made transparency – including tax – its standard, launching the challenge of privacy and compliance among the topics that – alongside law, tax and financial and budget reporting – represent the fields of action of the profession in Italy and beyond.
In order to achieve the objective of financial transparency and therefore of the verification of the origin of investments and / or transfers, the Community and then national legislators have identified the principle of notion and operation of the Adequate Verification and approach based on the risk of money laundering, the useful answers to achieve the long-awaited fight against crime, both common and financial, and not least mafia, without neglecting terrorism.
Therefore identifying the financial resources useful to commit a crime and sow terrorism is certainly the most effective and efficient answer for the support of the preventive and repressive system of crimes.
The importance of intelligence systems
The advanced intelligence system, implemented by all countries cannot ignore the analysis of suspicious financial flows ; therefore a system that allows to collect, select and analyze an incalculable amount of financial movements:
- first object of analysis by the same obliged subjects and,
- subsequently examined in depth by the authorities in charge of supervising, it allows both to highlight and filter the “false positives”, which in reality do not represent circumstances worthy of investigation and therefore to concentrate the inspection and intelligence inspection operations, giving the same phenomena a classification of importance and area of intervention.
Among all the obligations provided for by the Anti-Money Laundering legislation, that of adequate customer verification is certainly the architrave on which the Turkish anti-money laundering protection rests. In fact, this fulfillment is chronologically the first to be implemented and is the one that if implemented in an adequate manner can make the processes and obligations that follow from it less effective.
Know Your Customer in Turkey: Regulations
As required by the legislation pursuant to Turkish AML law (Law number: 5549) and subsequent amendments, adequate customer verification is, therefore, the cornerstone of the action to combat money laundering and terrorist financing. The transposition of the directive has focused decisively on the ” profiling ” of the recycler customer, therefore the study of the characteristics of the action and of the methodologies and case studies as a weapon of anti-money laundering to ” filter ” the great ocean of the national financial and economic system and international.
The principle of the ” risk-based approach ” is professed, therefore the line of proportionality of the obligations with respect to the profile and risk of money laundering of the customers being analyzed. Interviewing the customer is fundamental to classify him and to insert him in the right risk class. ” The risk element must therefore be taken into consideration not only for the detection and reporting of suspicious transactions, but also for the application of differentiated measures, simplified or strengthened, of adequate customer verification in relation respectively to hypotheses of lower or higher risk. This is a more extensive customer – due – diligence duty, to be carried out by means of information on the customer, on the actual owner of the relationship, on the nature and purpose of the business relationship, which involves continuous monitoring on the progress of the relationship. ” (7)
Therefore, based on the risk profile, the verification action carried out by the obliged subjects is determined and they must, therefore, be able to prove to the control authorities that have proportionally and constantly adopted suitable and adequate measures for the related risk of money laundering and financing. to the terrorism of its customers.
The risk-based approach is, therefore ” the dove egg ” which aims to maximize the effectiveness of corporate anti-money laundering measures, rationalizing the use of resources and at the same time reducing the burden on recipients.
If you would like to more information on AML and KYC regulations in Europe or Turkey, we welcome you to get in touch with our specialists.