AML in Cyprus

As a member of the European Union, Cyprus is obligated to adhere to the directives on anti-money laundering (AML). In order to comply with the EU’s directives and regulations, Cyprus is currently revising its legislation. The AML efforts of Cyprus are subject to regular audits conducted by both the European Union and the OECD. The Council of Europe Committee Moneyval has also conducted multiple international evaluations of Cyprus’s AML measures in recent years. The primary objective of these AML measures is to combat financial crimes.

Cyprus has designated several regulatory bodies responsible for AML and countering the financing of terrorism (CFT). These include:

  • The Central Bank of Cyprus
  • The Unit for Combating Money Laundering (MOKAS)
  • The Authority for the Supervision and Development of Cooperative Societies
  • The Securities and Exchange Commission
  • The Council of the Cyprus Bar Association
  • The Council of the Institute of Certified Public Accountants

The AML laws in Cyprus aim to achieve the following objectives:

  • Prevention of money laundering
  • Prevention of terrorist financing
  • Prevention of corruption
  • Prevention of bribery
  • Prevention of tax evasion

By implementing these AML regulations, Cyprus endeavors to enhance its effectiveness in combating financial crimes.

Banks, investment companies, money transfer companies, stock exchange companies, accountants, casinos, and other financial service providers operating in Cyprus are obligated to adhere to the anti-money laundering (AML) and countering the financing of terrorism (CFT) regulations. These entities bear the responsibility of implementing specific AML and Know Your Customer (KYC) controls throughout the customer onboarding, monitoring, and transaction processes. It is crucial for companies to assess the risk level of their customers through Customer Due Diligence measures. As per AML laws in Cyprus, organizations are required to promptly report any suspicious activities identified during these controls to the Unit for Combating Money Laundering (MOKAS). Non-compliant organizations may face fines imposed by the Government of Cyprus and the European Union.

To ensure compliance with both global and Cyprus-specific AML regulations, Sanction Scanner offers comprehensive solutions developed with artificial intelligence. Sanction Scanner facilitates end-to-end fulfillment of AML regulatory requirements for your company. With real-time data provision, Sanction Scanner assists in meeting the necessary compliance standards.

Organizations that fail to comply with AML face risks of fines and loss of reputation.

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During previous assessments conducted by external regulators, financial institutions and casinos in the Turkish Republic of Northern Cyprus (TRNC) were found to have vulnerabilities in their money laundering prevention measures. Due to the insufficient AML legislation in the TRNC, it is believed that significant financial crimes have been perpetrated in the past through these institutions. Moreover, the lack of adequate knowledge and expertise on AML within financial institutions has created opportunities for financial crimes to occur.

The Prevention of Money Laundering Law of the Turkish Republic of Northern Cyprus was introduced in 1999 and has been in place for over 20 years. In recent years, efforts have been made to enhance and align this legislation with EU directives. Officials from the Central Bank of the TRNC have emphasized an increased focus on combating money laundering and have indicated a rise in inspections. The forthcoming AML law, which aligns with EU directives and FATF regulations, is expected to be more effective in combating financial crimes in the Turkish Republic of Northern Cyprus. Additionally, both the Financial Crimes Investigation Board from Turkey and the European Union organize training sessions for financial institutions and casinos in the TRNC.

There has been a rise in AML audits conducted by regulators on casinos and financial institutions. Organizations that fail to meet their AML obligations continue to be vulnerable to financial crimes. Non-compliant entities face the risk of financial penalties and damage to their reputation.