Checking mobile phone balances becomes mandatory in Kazakhstan
In the Mazhilis meeting, Deputy Samat Nurtaza posed questions to Financial Monitoring Agency's Deputy Chairman, Jenis Elemesov, about the inclusion of mobile operators in the financial monitoring subjects
In today's digital world, mobile phones aren't just communication devices, they serve as mini-banks. We use them to pay bills, utilities, and more. Unfortunately, this convenience can be exploited by scammers who launder money through mobile operator accounts. With this concern, Nurtaza asked: "What extra info will mobile operators share with the Financial Monitoring Agency? What are the repercussions for breaching these measures? And most importantly, what limit should we set for mobile operator activities under scrutiny?"
As per Elemesov, mobile operators will divulge details about strange, unusual top-ups, as well as top-ups from various sources to a single subscriber. Plus, they'll be required to disclose the identities of all SIM card purchasers, crucial in the fight against 'dropperism'.
Penalties for AML law infringements are clearly outlined in the Administrative Code, Article 214. These consequences range from hefty fines to license revocation, depending on the violation's seriousness and impact. However, Elemesov mentioned there's no fixed limit for mobile operator transactions under investigation. They're only concerned with suspicious transactions that, when combined, raise doubts.
To shed some light on AML regulations, here's a quick rundown: Financial institutions, including entities like mobile payment services, are often subject to AML rules. These regulations generally require entities to:
- Diligently Verify Identities: This involves identifying customers and understanding their business dealings.
- Risk-Based Monitoring: This implies monitoring transactions based on their risk level to detect suspicious activities.
- Suspicious Activity Reporting (SAR): If any suspicious activities are detected, they should be reported to relevant authorities.
Violating AML regulations can lead to severe consequences, such as significant fines, audits, investigations, and damage to business reputation. Though these penalties are primarily for financial institutions, mobile operators might face similar consequences if they're obliged to adhere to AML regulations. However, precise details about mobile operators' obligations will vary based on jurisdiction and the nature of their financial activities. For a comprehensive understanding of mobile operators' AML responsibilities, one must consult specific regulatory guidelines tailored to their operations.
The financial monitoring subjects, as outlined by AML regulations, extend beyond traditional financial institutions to include mobile operators, as they engage in digital transactions. With mobile operators becoming subject to these regulations, questions arise about the identity diligence, risk-based monitoring, and suspicious activity reporting measures that will apply, as well as the potential penalties for non-compliance.
