Informing on the results of the State Financial Monitoring Service of Ukraine for the 9 month of 2019
The SFMS as a financial intelligence unit of Ukraine takes enhanced practical measures aimed at counteraction to the legalization (laundering) of the proceeds from crime, terrorist financing and financing of proliferation of weapon of mass destruction. In particular, for the 9 month of 2019, the SFMS has prepared 641 referrals (of them 383 case referrals and 258 additional case referrals) which have been submitted to:
the Prosecutor’s offices of Ukraine – 82 referrals (of them 23 case referrals and 59 additional case referrals);
the State Fiscal Service of Ukraine –152 referrals (of them 116 case referrals and 36 additional case referrals);
the Internal affairs authorities of Ukraine – 131 referrals (of them – 115 case referrals and 16 additional case referrals);
the Security Service of Ukraine – 156 referrals (of them – 86 case referrals and 70 additional case referrals);
the National Anti-Corruption Bureau of Ukraine – 114 referrals (of them – 37 case referrals and 77 additional case referrals);
the State Bureau of Investigations – 6 case referral.
In these referrals, the amount of financial transactions that may be related to the legalization (laundering) of funds or the commission of another criminal offense is UAH 81,1 billion.
The SFMS pays particular attention to investigation of money laundering facts of corrupt acts, embezzlement and appropriation of state funds and property.
Thus, for the 9 month of 2019, the SFMS has submitted to law enforcement authorities 153 referrals (42 case referrals and 111 additional case referrals) which are related to suspicion in corrupt acts, in particular to:
the National Anti-Corruption Bureau of Ukraine - 114 referrals;
the Prosecutor’s offices of Ukraine – 28 referrals (of them 1 case referral and 27 additional case referrals);
the Security Service of Ukraine – 3 referrals (of them 1 case referral and 2 additional case referrals);
the Internal affairs authorities of Ukraine – 1 additional case referral.
In these referrals, the amount of financial transactions that may be related to the legalization (laundering) of funds or the commission of another criminal offense, defined by the Criminal Code of Ukraine is UAH 40,1 billion.
According to the legislation of Ukraine, the SFMS (as a financial intelligence unit) together with law enforcement authorities, takes measures aimed at preventing and countering to the financing of terrorist activities, separatism.
Thus, for the 9 month of 2019, the SFMS has submitted to law enforcement authorities 73 referrals (of them 29 case referrals and 44 additional case referrals) regarding financial transactions of persons which, may be related to the financing of terrorism, separatism and/or conducted with the participation of persons, who publicly call for violent change or overthrow of the constitutional order or change of boundaries of the territory or state border of Ukraine, including:
25 referrals (of them 1 case referral and 24 additional case referrals) related to the implementation of financial transactions by individuals, whose identification data coincide with the identification data of the persons included in the List of Persons, related to the commission of terrorist activities or on which person’s international sanctions have been applied;
7 referrals (of them 2 case referrals and 5 additional case referrals), related to the implementation of financial transactions by persons included in the annexes to the decision of the National Security and Defense Council of Ukraine from 28.04.2017 (enacted by Decree of the President of Ukraine from 15.05.2017 №133/2017) and from 21.06.2018 (enacted by Decree of the President of Ukraine from 21.06.2018 №176/2018);
9 case referrals (of them 9 additional case referrals) related to suspicions in the conduct of financial transactions by persons involved in the activities of the international terrorist group "Islamic State of Iraq and Levant" or other extremist groups;
32 referrals (of them 17 case referrals and 15 additional case referrals), that may be associated with suspicion of financing illicit armed groups in the temporarily occupied territories in the Donetsk and Luhansk oblasts.
Of the 73 transmitted referrals, 18 referrals contained information on identified relationships with the Russian Federation.
Referrals were sent to the Security Service of Ukraine, to the Prosecutor General’s office of Ukraine, to the National Anti-Corruption Bureau of Ukraine and to the State Bureau of Investigations.
In 37 cases (referrals) blocked funds of financial transactions of individuals who, according to information from law enforcement authorities, may be involved in the financing of terrorism, separatism, for a total amount equal to UAH 27,59 billion.
In order to increase the effectiveness of interagency cooperation, during the reporting period, the SFMS took coordinating measures for the implementation by the relevant state authorities of the Action Plan to improve the national financial monitoring system based on the MONEYVAL 5th round of mutual evaluation of Ukraine (hereinafter - the Action Plan). Thus, the SFMS has ensured a generalization of information provided by state and law enforcement authorities on the progress of the implementation of the Action Plan in 2018, and in the first quarter of this year, sent generalized information to the Cabinet of Ministers of Ukraine.
In addition, the SFMS has taken measures for the preparation of the 1st follow-up report of Ukraine by all interested state authorities according to the results of the MONEYVAL 5th round of mutual evaluation of Ukraine.
During July 16-19, 2019, the delegation of Ukraine headed by the representative of the State Financial Monitoring Service of Ukraine is participating in the 58th MONEYVAL Plenary meeting in Strasbourg, France. During the Plenary meeting, the Head of the delegation of Ukraine will present the 1st Follow-up Report of Ukraine following the MONEYVAL 5th round of mutual evaluation, which was successfully approved by the Committee on 18 July. The approval of this report became a confirmation of the international community's adoption of steps taken by our country in improving the effectiveness of the national financial monitoring system.
At the same time, the importance of the financial monitoring area in state security was confirmed by the appointment of the Head of The SFMS Igor Cherkaskyi as a member of the National Security and Defense Council of Ukraine.
Also, during the 9 month of 2019, the SFMS representatives participated in 51 coordination meetings with the interested state authorities in AML/CFT issues.
During the reporting period the SFMS concluded:
Memorandum on the general principles of cooperation in the area of counteraction to the legalization (laundering) of proceeds from crime, terrorist financing and financing of the proliferation of weapons of mass destruction with the National Institute for Strategic Researches;
Agreement with the State Agency for Electronic Governance on the connection to the systems of electronic interaction of state electronic information resources and in order to join the integrated electronic identification system of the Unified Information System in the area of prevention and counteraction to the legalization (laundering) of proceeds from crime, terrorist financing and financing of the proliferation of weapons of mass destruction;
Memorandum for interaction and cooperation with “YOU-CONTROL” organization on using YouControl Service;
Memorandum for cooperation in development of a mechanism for verifying information on ultimate beneficial owners.
Moreover, in April 2019, a team formed under the leadership of the SFMS with the idea of a mechanism for verification of ultimate beneficial owners (UBO) under the name "100%RELIABLE" became the winner and was granted with the “Most Innovative Solution” award on the results of the Pilot Program “EU Association Lab”.
In terms of cooperation coordination with the state authorities, public and private sector, the SFMS has organized the regular meeting of the Council on counteraction to the legalization (laundering) of the proceeds from crime, terrorist financing and financing of the proliferation of weapons of mass destruction, Working Group on prevention and counteraction of financing of the proliferation of weapons of mass destruction, three meetings and a constituent meeting on formation of a new composition of the Public Council at the SFMS, and the ninth meetings of the Working Group on Problem Issues of the reporting entities - banking institutions and a joint meeting of the banking and non-banking Working Groups on the reporting entities issues.
At the same time, in order to improve information interaction with the public, a new web portal of SFMS has been launched: http://fiu.gov.ua.
Within the framework of legislative initiatives, the SFMS during the reporting period has provided active support to the developed with the SFMS assistance Draft Law “On Prevention and Counteraction of Legalization (Laundering) of the Proceeds from Crime, Terrorist Financing and Financing the Proliferation of Weapons of Mass Destruction”, which was supported by the Cabinet of Ministers of Ukraine and registered on September 25, 2019 in the Verkhovna Rada of Ukraine by registration number 2179.
The draft law was developed to implement the provisions of the Fourth EU Directive 2015/849 "On the prevention of the use of the financial system for the purpose of money laundering and terrorist financing" and the provisions of EU Regulation 2015/847 "On information accompanying transfers of funds".
Also, the SFMS has started the process of conducting the second round of the National Risk Assessment of the ML/FT based on the Methodology updated in 2018.
Within the framework of methodological work, during the 9 month of 2019, the representatives of the SFMS participated in 70 educational events, which involved about 2600 persons.
In the direction of international cooperation:
during the period from March 24 to 27, the representative of the SFMS participated in the joint expert meeting of FATF and MONEYVAL (Tel Aviv, Israel);
during the period from June 30 to July 4, the representatives of the SFMS participated in the meetings of the Working Groups and the 26th Plenary Meeting of the Egmont Group of Financial Intelligence Units in the Hague, Netherlands;
during the period from July 15 to 19, the representatives of the SFMS participating in the 58th Plenary meeting of the Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL).
Also, the SFMS in the reporting period signed Memoranda of Understanding in the AML/CFT area with the FIUs of Kuwait and the Republic of Austria and the Statement of Cooperation with the FIU of Japan.
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