Government, media and public opinion have generated increasing attention, pressure, and action to combat money laundering and the financing of terrorist activities and organizations.
Mobilized by reality and the perception that there are financial flows that escape the mechanisms of control and monitoring, political and financial decision-makers converged on the need to impose tighter rules that would help reduce the margins of the shadow economy, the dynamics associated with financial crime and the financing mechanisms for terrorist activities.
The social environment generated by the difficulties of the banking system and the emergence of several financial and political scandals, generated considerable social alarm and widespread awareness of the existence of a problem requiring preventive and repressive action.
Globalization, which has amplified opportunities, has also generated a set of new risks related to negative dynamics affecting communities, states, and international institutions. The particularities of money laundering and terrorist financing problems require an integrated, sustained, and international strategy, in which each country can be a pillar of global intervention in the face of a reality that, in many situations, spreads beyond each particular country border.
The instrument to combat money laundering and terrorist financing
Since 2017, the Portuguese legislation has adopted European directives on combating money laundering and terrorist financing, determining the identification of Politically Exposed Persons (PEP) in all business transactions over €1,000 in cash. That is, from the purchase of a watch to the provision of banking, legal or accounting services, whenever the payment of such amount is in cash, there is a legal duty to identify if the interlocutor is a PEP.
Non-compliance with the law is penalized with high fines and accessory penalties, which can go as far as disqualification from exercising professional functions. However, there are still many sectors of society that take risks and do not contribute to this fight.
The solution to comply with the law
How to ensure access to adequate, updated, and consistent information, in Portugal, in Europe and in the framework of other international organizations involved in the fight against money laundering and terrorist financing?
In partnership with Pepdata, Iberinform complements its range of services with alternative solutions to manage risk and make decisions with accurate information to avoid potential sanctions resulting from compliance with the legal framework in force. Pepdata is a Portuguese Startup that has the necessary skills to design a program that manages the official lists of Politically Exposed People, that is constantly updated and in strict compliance with the rules of the General Data Protection Regulation, allowing the full compliance with the identification and diligence duties.
As this is an area that is constantly changing due to modifications in legislation and public pressure on countries to do more and better, the service ensures constant updating and dedicated monitoring in the construction of solutions tailored to the needs and dynamics.
Written by Nuno Marçal Moita
Iberinform Portugal Territory Director