On December 20 of last year, the Financial Action Task Force (FATF) stated that Ukraine had not fulfilled its requirements for combating money laundering and imposed sanctions against it. At the same time, the FATF, which includes 29 leading countries of the world, recommended that its members tighten financial reporting on transactions with Ukrainian companies.
The British Ministry of Finance called on banks and companies of the United Kingdom to exercise particular caution when conducting any transactions with Ukrainian partners in order not to be implicated in money laundering. In addition, London recommends that its citizens and companies report to law enforcement authorities all financial transactions with Ukrainian partners, except in cases where there is complete confidence in the legality of the operations. Canada issued similar warnings.
Berlin recommended that its companies, banks, and citizens report all transactions that raise even the slightest suspicion in which Ukrainian partners are involved in any way, especially if the amounts exceed 15,000 euros ($16,000). All transactions, except those in which German partners are absolutely confident of their legality, must become the subject of investigation by law enforcement agencies and cannot be completed without the sanction of the prosecutor's office or criminal police. It is expected that the United States will adopt similar measures in the near future.
In fact, the vast majority of financial transfers to Ukraine from these countries fall under suspicion by local law enforcement agencies. It also becomes extremely difficult to open representative offices of banks and companies from these states in Ukraine.
The adoption of these sanctions became inevitable after the FATF recommendation. Ukrainian bankers say that correspondent accounts of their banks in countries that have already imposed sanctions may be closed. However, so far this only concerns small Ukrainian banks. But the reporting and monitoring requirements will lead to a multiple increase in the cost of transferring money from Ukraine to the West and in the opposite direction.
Kyiv is trying to avoid sanctions. Last week, the Ukrainian parliament approved a law providing for stricter penalties for money laundering, and the head of the state committee tasked with combating money laundering was dismissed from his post. Finance Minister and First Deputy Prime Minister Mykola Azarov stated that the country had fulfilled all international requirements and that the issue of sanctions would be resolved during negotiations with the FATF. Ukrainian Prime Minister Viktor Yanukovych assured journalists that negotiations to lift the sanctions would begin in January.
However, the fact that the statements of the financial authorities of Britain, Canada, and Germany became public after the Ukrainian parliament adopted laws to tighten the fight against money laundering may be evidence that these laws will be deemed insufficient, reports the BBC.