Article 13. Refusal to conduct and suspension of transactions with money and (or) Other Property of the Law on Countering the Legalization (Laundering) of Proceeds from Crime and the Financing of Terrorism

      1. Financial monitoring entities are obliged to refuse to establish business relations to an individual, a legal entity, or a foreign entity without forming a legal entity if it is impossible to take the measures provided for in paragraphs 1), 2), 2-1), 2-2) and 4) paragraph 3 of Article 5 of this Law.  

     The subjects of financial monitoring are obliged to refuse an individual, a legal entity or a foreign structure without forming a legal entity to conduct transactions with money and (or) other property and (or) terminate business relations if it is impossible to take the measures provided for in the sub-paragraphs 1), 2), 2-1), 2-2), 4) and 6) points 3 of Article 5 of this Law.

     Financial monitoring entities have the right to refuse to conduct transactions with money and (or) other property, as well as to establish business relations and (or) terminate business relations with the client if there is suspicion that the business relationship is being used by the client for the purpose of legalizing (laundering) proceeds from crime or financing terrorism, financing the proliferation of weapons of mass destruction.

     1-1. Subjects of financial monitoring, within twenty-four hours from the date of posting on the Internet resource of the authorized body of the list of persons involved in terrorist activities, information on the inclusion of an organization or person in the list of organizations and persons associated with the financing of terrorism and extremism, as well as in the list of organizations and persons associated with the financing of the proliferation of weapons of mass destruction, they must immediately (except in the following cases, established by paragraph 8 of Article 12 and paragraphs 5 and 6 of Article 12-1 of this Law) to take the following measures to freeze transactions with money and (or) other property:

     suspend spending operations on the bank accounts of such an organization or individual, on the bank accounts of a client whose beneficial owner is such an individual (with the exception of operations related to servicing bank accounts), an organization directly or indirectly owned or controlled by such an organization or individual, as well as an individual or legal entity, acting on behalf of or at the direction of such an organization or such an individual;

      suspend the execution of instructions on payment or money transfer without using the bank account of such organizations and individuals, the instructions of a client whose beneficial owner is such an individual, organizations directly or indirectly owned or controlled by such an organization or individual, as well as an individual or legal entity acting on behalf of or at the direction of such an organization or such an individual;  

     to block securities in the system of registers of securities holders and the system of accounting for nominal holdings on the personal accounts of such an organization or individual, on the personal accounts of a client whose beneficial owner is such an individual, an organization directly or indirectly owned or controlled by such an organization or individual, as well as an individual or legal entity, acting on behalf of or at the direction of such an organization or such an individual;

to refuse to carry out operations to make insurance payments, to refund the insurance premium or part of it in case of early termination of the voluntary insurance contract;

     to refuse to conduct other transactions with money and (or) other property performed by such an organization or an individual or in their favor, as well as by a client whose beneficial owner is such an individual, or in his favor (with the exception of crediting money to such a person to a bank account, making, transferring mandatory pension contributions to a single an accumulative pension fund), an organization directly or indirectly owned or controlled by such an organization or individual, or for its benefit, as well as by an individual or legal entity, acting on behalf of or at the direction of such an organization or such an individual, or for their benefit.

     The measures to freeze transactions with money and (or) other property provided for in part one of this paragraph shall not apply to the following transactions under contracts concluded with a financial monitoring entity prior to the person's inclusion in the list of organizations and persons associated with the financing of terrorism and extremism:

      1) extending the terms of a bank deposit;  

     2) debiting and transferring money from the bank account of a person included in the list of organizations and persons associated with the financing of terrorism and extremism, in order to repay obligations under bank loan, leasing or microcredit agreements.

      Expenditure transactions on bank accounts, registration of transactions with securities in the system of registers of securities holders and the system of accounting for nominal holding on personal accounts, as well as other transactions with money and (or) other property of organizations or individuals included in the list of organizations and persons related to the financing of terrorism and extremism, provided for in paragraph 1 Article 12 of this Law may be carried out by financial monitoring entities on the basis of a court decision, collection orders of the state revenue authority., resolutions of the state revenue authority on foreclosure on property limited in its disposal, as well as after the exclusion of an organization or individual from the above list in accordance with the procedure provided for by this Law.

     2. In order to prevent the facts of the legalization (laundering) of proceeds from crime, the financing of terrorism and the financing of the proliferation of weapons of mass destruction, financial monitoring entities are obliged, upon recognizing an operation as suspicious, to immediately inform the authorized body about such an operation before it is carried out.

     Reports on transactions involving money and (or) other property that were not considered suspicious prior to their conduct are submitted by financial monitoring entities to the authorized body no later than twenty-four hours after the operation is recognized as suspicious.

     At the same time, the difference between the time of the transaction and the time of recognition of such an operation as suspicious may not exceed the time interval that determines the frequency of examining the client's operation in accordance with the rules of internal control of the financial monitoring entity.

     Financial monitoring entities shall submit to the authorized body reports on the facts of refusal to establish business relations to an individual, legal entity or foreign structure without forming a legal entity, termination of business relations with a client, refusal to conduct transactions with money and (or) other property on the grounds provided for in paragraph 1 of this article, as well as measures to freeze transactions. with the money and (or) other property provided for in paragraph 1-1 of this Article, no later than a business day, following the day when the financial monitoring entity makes the appropriate decision (action) electronically through dedicated communication channels in Kazakh or Russian.

      3. Upon receiving the notification provided for in paragraph one of paragraph 2 of this article, the authorized body shall, within twenty-four hours from the date of its receipt, decide to suspend the conduct of a suspicious transaction for up to three working days if the notification of a suspicious transaction submitted by the financial monitoring entity is found to be justified based on the results of an analysis conducted by the authorized body, with the exception of the operation provided for in subparagraph 1) of the first part of paragraph 8 of Article 12 of this Law.

      The authorized body, having received a report of a suspicious transaction provided for in subparagraph 1) of the first part of paragraph 8 of Article 12 of this Law, within twenty-four hours, makes a decision on conducting an operation or refusing to conduct an operation and brings it to the subjects of financial monitoring electronically.

     If the last day of the decision-making period falls on a non-working day, the day of the end of the decision-making period is considered to be the next working day following it.

     The decision to suspend a suspicious transaction or whether there is no need to suspend a suspicious transaction is made by the authorized body and communicated to the financial monitoring entity and the government agency that provided the suspicious transaction report electronically or on paper.

      4. Before the authorized body makes a decision on suspending a suspicious transaction or on the absence of the need to suspend a suspicious transaction, a financial monitoring entity shall not conduct transactions with money and (or) other property reported in accordance with the first part of paragraph 2 of this Article.  

     If the financial monitoring entity fails to receive, within twenty-four hours from the date of notification of the information, the decision of the authorized body to suspend a suspicious transaction or that there is no need to suspend such an operation, the operation must be carried out, unless there are other grounds provided for by the legislative acts of the Republic of Kazakhstan that prevent this operation.

5. After making a decision to suspend a suspicious transaction, the authorized body immediately transmits information to law enforcement and special state bodies of the Republic of Kazakhstan in accordance with their competence for making a decision and notifies the Prosecutor General's Office of the Republic of Kazakhstan about it.

      The relevant law enforcement and special state bodies of the Republic of Kazakhstan, from the moment the authorized body makes a decision to suspend a suspicious transaction, are required to make a decision within seventy-two hours and report it to the Prosecutor General's Office of the Republic of Kazakhstan and the authorized body.  

     The authorized body shall inform the financial monitoring entity of the relevant decision of law enforcement and special state bodies of the Republic of Kazakhstan within three hours from the date of its receipt.

     5-1. If a decision is received from law enforcement and special state bodies of the Republic of Kazakhstan on the need to suspend a suspicious operation transferred in accordance with paragraph 5 of this article, for which there are grounds to believe that this operation is aimed at legalizing (laundering) proceeds from crime or financing the proliferation of weapons of mass destruction, the authorized body shall make a decision on the suspension of spending operations on bank accounts or transactions with electronic money of individuals, who are participants in such an operation, for a period of up to fifteen calendar days.

     The decision to suspend spending operations on bank accounts or transactions with electronic money of persons who are participants in the operation, for which there are grounds to believe that they are aimed at legalizing (laundering) proceeds from crime or financing terrorism, is taken by the authorized body and brought to the attention of financial monitoring entities provided for in subparagraph 1) paragraph 1 of Article 3 of this Law.

     The authorized body informs the Prosecutor General's Office of the Republic of Kazakhstan, law enforcement and special state bodies of the Republic of Kazakhstan, which submitted this decision, about the suspension of spending operations on bank accounts or operations with electronic money.

     5-2. After the expiration of the suspension period for a suspicious transaction, by decision of the authorized body, the operation must be carried out in the absence of other grounds provided for by legislative acts of the Republic of Kazakhstan that prevent such an operation.

     6. Refusal to conduct or suspend transactions with money and (or) other property, as well as refusal to establish business relations or termination of business relations in accordance with this Law, are not grounds for civil liability of financial monitoring entities for violating the terms of relevant agreements (obligations).

     The suspension and freezing of transactions with money and (or) other property are not grounds for civil or other liability of government agencies for damage, including lost profits, resulting from such suspension, the application of freezing and freezing measures.

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 and the financing of terrorism, 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 mechanisms for the implementation of targeted financial sanctions related to to prevent and prevent terrorism and terrorist financing, and to prevent, preventing and stopping 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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