Article 11. Conducting internal control by financial monitoring entities The Law on Countering the Legalization (Laundering) of Proceeds from Crime, the Financing of Terrorism and the Financing of the Proliferation of Weapons of Mass Destruction

     1. Financial monitoring entities shall take measures according to which their services will not be used by other persons for the purpose of committing or assisting in the legalization (laundering) of proceeds from crime, financing terrorism and financing the proliferation of weapons of mass destruction.

     2. Financial monitoring entities, in order to prevent the legalization (laundering) of proceeds from crime, the financing of terrorism and the financing of the proliferation of weapons of mass destruction, develop internal control rules and programs for its implementation, and are responsible for compliance with the rules and the implementation of programs.

     3. Internal control rules are developed and adopted by the governing body or executive body of financial monitoring entities with the formation of a legal entity and a financial monitoring entity without the formation of a legal entity, and are executed by financial monitoring entities, taking into account the results of an assessment of the degree of exposure of financial monitoring entities' services to the risks of money laundering, terrorist financing, and financing the proliferation of weapons of mass destruction., the size, nature, and complexity of the organization, and, In addition to the requirements for the activities of a financial monitoring entity, when conducting internal control provided for by this Law, they should include:

     a program for organizing internal control in order to counteract the legalization (laundering) of proceeds from crime, the financing of terrorism and the financing of the proliferation of weapons of mass destruction, including the requirement to appoint a person responsible for the implementation and compliance with internal control rules from among the senior staff of the financial monitoring entity or other managers of the financial monitoring entity at least at the level of the head of the relevant structural divisions, as well as other requirements, requirements for employees of financial monitoring entities responsible for the implementation and compliance with internal control rules, including the availability of an impeccable business reputation;

     a risk management program (low and high risk levels) for the legalization (laundering) of proceeds from crime, the financing of terrorism and the financing of the proliferation of weapons of mass destruction, taking into account the risks of customers and the risks of using services for criminal purposes, including the risk of using technological advances;

     customer identification program;

     a program for monitoring and studying customer transactions, including the study of complex, unusually large and other unusual customer transactions;

     the program of training and education of subjects of financial monitoring in the field of countering the legalization (laundering) of proceeds from crime, the financing of terrorism and the financing of the proliferation of weapons of mass destruction;

     other programs that may be developed by financial monitoring entities in accordance with the rules of internal control.

     The financial monitoring entities specified in subitems 1) – 5), 11) and 12) of paragraph 1 of Article 3 of this Law and which are members of a financial group have the right to develop, adopt and enforce internal control rules for this financial group, taking into account the specifics and peculiarities of its members.

     3-1. Financial monitoring entities ensure compliance and implementation of internal control rules by their branches, representative offices, subsidiaries located both in the Republic of Kazakhstan and abroad, if this does not contradict the legislation of the state of their location.

     Financial monitoring entities are required to inform the authorized body and the control and supervision body about the inability of their branches, representative offices, and subsidiaries located outside the Republic of Kazakhstan to comply with and implement internal control rules due to inconsistencies with the legislation of their State of location, as well as to apply additional controls and procedures to manage the risks of money laundering criminally obtained, financing of terrorism and financing the proliferation of weapons of mass destruction and reducing the risks of legalizing (laundering) proceeds from crime, financing terrorism and financing the proliferation of weapons of mass destruction.

     Organizations that have concluded an agency agreement for the provision of payment services with a payment agent or payment subagent are required to include it in their programs to counteract the legalization (laundering) of proceeds from crime, the financing of terrorism and the financing of the proliferation of weapons of mass destruction and monitor their implementation of such programs.

     3-2. The requirements to the rules of internal control in order to counteract the legalization (laundering) of proceeds from crime, the financing of terrorism and the financing of the proliferation of weapons of mass destruction by types of financial monitoring entities are established:

      by the authorized body for regulation, control and supervision of the financial market and financial organizations in coordination with the authorized body for financial monitoring entities provided for in subparagraphs 1) (except for legal entities operating exclusively through exchange offices on the basis of a license from the National Bank of the Republic of Kazakhstan for exchange operations with foreign currency in cash), 2) (except for commodity exchanges, stock brokers operating on the commodity exchange and making transactions with commodities, and clearing centers of commodity exchanges), 3), 4), 5) and 11) paragraph 1 of Article 3 of this Law;

      The National Bank of the Republic of Kazakhstan, in coordination with the authorized body for financial monitoring entities provided for in paragraphs 1) (regarding legal entities operating exclusively through exchange offices on the basis of a license from the National Bank of the Republic of Kazakhstan for exchange operations with foreign currency in cash) and 12) paragraph 1 of Article 3 of this Law;

      the relevant state body, in coordination with the authorized body for financial monitoring entities provided for in subitems 6), 9), 10) and 20) of paragraph 1 of Article 3 of this Law, as well as commodity exchanges, stock brokers operating on the commodity exchange and making transactions with commodities, and commodity exchange clearing centers;

      by the authorized body for financial monitoring entities provided for in sub-paragraphs 7), 8), 13), 15), 16) ,18), 21) and 22) paragraph 1 of Article 3 of this Law;

      The AIFC Financial Services Regulatory Committee, in coordination with the authorized body for financial monitoring entities provided for in subparagraph 19) of paragraph 1 of Article 3 of this Law.

     4. Documents and information obtained as a result of due diligence of the client, including the client's dossier, account information (for banks and organizations that open and maintain accounts), and correspondence with him, are subject to storage by financial monitoring entities for at least five years from the date of termination of business relations with the client.

      Documents and information about transactions with money and (or) other property, including those subject to financial monitoring, and suspicious transactions, as well as the results of studying all complex, unusually large and other unusual transactions, are subject to storage by financial monitoring entities for at least five years after the transaction.  

     The documents and information specified in parts one and two of this paragraph must contain information that allows the client's transactions to be restored, including amounts and types of currencies.

     5. It is prohibited to inform clients and other persons about measures to counteract the legalization (laundering) of proceeds from crime, the financing of terrorism and the financing of the proliferation of weapons of mass destruction taken against such clients and other persons, with the exception of informing clients about measures taken to freeze transactions with money and (or) other property, refusal to establish business relations, as well as refusal to conduct transactions with money and (or) other property.

  5-1. Financial monitoring entities and their employees are not entitled to notify clients and other persons of receipt from the authorized body of a list of organizations and persons conducting suspicious transactions with money and (or) other property.

     6. The provision of information, information and documents to the authorized body by financial monitoring entities for the purposes and in accordance with the procedure provided for by this Law does not constitute disclosure of commercial, banking or other legally protected secrets, violation of the conditions for the collection and processing of personal data, as well as other legally protected information.

     The financial monitoring entities specified in subitems 1) – 5), 11) and 12) of paragraph 1 of Article 3 of this Law and being members of a financial group, are entitled to exchange information and documents obtained as part of the implementation of internal control and use them in accordance with the procedure established by the rules of internal control, subject to the following conditions:

     1) with respect to information and documents exchanged in accordance with this paragraph, financial monitoring entities have fulfilled the requirements established by the internal control rules for the financial group;

2) in the absence of doubts about the reliability and accuracy of information and documents, the exchange of which and their use are permitted in accordance with this paragraph;

     3) if the client of the financial monitoring entity agrees in writing to transfer information and documents about the client to other participants of such a financial group and to use them.

     7. If information, information and documents are provided to the authorized body in accordance with this Law, financial monitoring entities, their employees and officials, regardless of the results of the communication, shall not be liable under the laws of the Republic of Kazakhstan, as well as a civil contract.

     8. The requirements for financial monitoring entities for training and education in the field of countering the legalization (laundering) of proceeds from crime and the financing of terrorism are approved by the authorized body in coordination with government agencies exercising, within their competence, state control over compliance by financial monitoring entities with the legislation of the Republic of Kazakhstan on countering the legalization (laundering) of proceeds from crime. financing of terrorism and financing the proliferation of weapons of mass destruction.

The Law of the Republic of Kazakhstan dated August 28, 2009 No. 191-IV.

     This Law defines the legal basis for countering the legalization (laundering) of proceeds from crime, the financing of terrorism and the financing of the proliferation of weapons of mass destruction, the legal relations of financial monitoring entities, the authorized body and other state bodies of the Republic of Kazakhstan in the field of countering the legalization (laundering) of proceeds from crime and the financing of terrorism, as well as the mechanisms for implementing targeted financial sanctions, related to the prevention and prevention of terrorism and the financing of terrorism, and the prevention, prevention and cessation of the proliferation of weapons of mass destruction and their financing.

President    

Republic of Kazakhstan     

© 2012. RSE na PHB "Institute of Legislation and Legal Information of the Republic of Kazakhstan" of the Ministry of Justice of the Republic of Kazakhstan  

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