Source: http://paclii.org/vu/legis/num_act/alacfa2014522/
Timestamp: 2020-08-07 09:51:43
Document Index: 4648559

Matched Legal Cases: ['art 6', 'art 6', 'ART 2', 'ART 3', 'ART 4', 'art 5', 'ART 5', 'art 6', 'art 4', 'ART 6', 'ART 7', 'art 6', 'art 4', 'art 5', 'ART 8', 'ART 9', 'art 3', 'ART 10', 'arts 3', 'art 4', 'art 3', 'arts 3', 'art 3', 'ART 11']

Anti-Money Laundering and Counter-Terrorism Financing Act 2014
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Assent: 18/06/2014
An Act to provide for the establishment of the Financial Intelligence Unit and to regulate reporting entities to give effect to Anti-Money Laundering and Counter-Terrorism Financing measures, and for related purposes.
account means any facility or arrangement in which a reporting entity does any of the following:
(a) accepts deposits of funds;
(b) allows withdrawals of funds;
(c) pays negotiable or transferable instruments or cheques or payment orders drawn on behalf of any person, or collects negotiable or transferable instruments or cheques or payment orders on behalf of a person,
and includes any facility or arrangement for a safety deposit box or for any other form of safe deposit or held in a cash management trust;
activity means a series of transactions or an act or omission of an act;
assisting entity means:
(a) a law enforcement agency or supervisory body outside Vanuatu or any other institution or agency of the relevant foreign state; or
(b) an international organization established by the governments of foreign states; or
(c) a body outside Vanuatu with functions similar to the Unit; or
(d) a law enforcement agency or supervisory body within Vanuatu;
AML means Anti-Money Laundering;
(a) a natural person who ultimately owns or controls the right to or benefits from a fund; or
(b) a person who exercises ultimate effective control over a legal person or legal arrangement;
business relationship means a business, professional or commercial relationship which is:
(a) connected with the professional activities of a reporting entity; and
(b) expected at the time when the contact is established, to have an element of duration;
cash means any coin or paper money that is designated as legal tender in the country of issue;
CTF means Counter-Terrorism Financing;
(a) the cash of Vanuatu or of a foreign country that is designated as legal tender and which is customarily used and accepted as a medium of exchange in the country of issue; or
(b) monetary instruments that may be exchanged for money, including cheques, travellers cheques, money orders and negotiable instruments in a form in which title passes on delivery; or
(c) a precious metal or precious stone; or
(d) such other monetary instruments specified by the Minister by Order; or
(e) currency in electronic form including debit cards, credit cards, pre-paid mobile phones and any other electronic device with a stored value;
customer in relation to a transaction, business relationship or an account includes:
(a) the person in whose name or for whom a transaction, relationship or account is arranged, opened or undertaken; or
(b) a signatory to the transaction, relationship or account; or
(c) any person to whom, a relationship or an account or rights or obligations under a transaction or relationship have been assigned or transferred; or
(d) any person who is authorised to conduct the transaction or control the relationship or account; or
data means representations, in any form, of information or concepts;
Director means the Director of the Financial Intelligence Unit appointed under section 7;
financing of terrorism offence means an offence against section 6 of the Counter Terrorism and Transnational Organised Crime Act [CAP 313];
(a) currency; or
(b) assets of any kind, whether corporeal or incorporeal, moveable or immovable, tangible or intangible; or
(c) legal documents or instruments in any form including electronic or digital, evidencing title to, or interest in, such assets, including but not limited to bank credits, traveller’s cheques, bank cheques, money orders, shares, securities, bonds, drafts and letters of credit; or
(d) any legal or equitable interest in any such asset;
(b) the Department of Customs and Inland Revenue; or
(c) the Department of Immigration; or
(d) a Police organisation or institution outside of Vanuatu; or
(e) an organisation responsible for criminal prosecutions or investigations inside or outside of Vanuatu; or
(f) such other persons prescribed for the purposes of this definition;
Minister means the Prime Minister;
money laundering entity means a person or group prescribed under subsection 53(2);
money laundering offence means an offence against section 11 of the Proceeds of Crime Act [CAP 284];
originator means the account holder or where there is no account, the person that places the order with a reporting entity to perform an electronic funds transfer;
person means any natural or legal person and includes any statutory body, company or association or body of persons corporate or unincorporated;
politically exposed person means an individual who is or has been entrusted with prominent public functions such as the Head of State, the Prime Minister, Ministers, senior politicians, senior Government officials, judicial or military officials, senior executive members of state owned corporations or international organisations and officials of a political party;
prescribed entity means:
(a) a specified entity within the meaning of the Counter Terrorism and Transnational Organised Crime Act [CAP 313]; or
(b) a money laundering entity;
record means any material on which information is recorded or marked and which is capable of being read or understood by a person, computer system or other device;
reporting entity has the meaning given by section 2;
(a) an offence against a law of Vanuatu for which the maximum penalty is imprisonment for at least 12 months; or
(b) an offence against the law of another country that, if the relevant act or omission had occurred in Vanuatu, would be an offence against the laws of Vanuatu for which the maximum penalty is imprisonment for at least 12 months; or
(c) an offence against a law of Vanuatu or another country that, if the relevant act or omission had occurred in Vanuatu, would be an offence against the laws of Vanuatu for which the proceeds of that offence is VT10 million or more or its equivalent in foreign currency;
supervisory body means:
(a) the Reserve Bank of Vanuatu; or
(b) the Vanuatu Financial Services Commission; or
(c) the registrar of Cooperatives; or
(d) the inspector of Casinos; or
(e) a body outside Vanuatu with functions similar to the Reserve Bank of Vanuatu or the Vanuatu Financial Services Commission; or
suspicious activity report means a report prepared under Part 6;
suspicious transaction report means a report prepared under Part 6;
terrorist organization includes an individual or organization prescribed by the Regulations to be a terrorist organization;
terrorist property has the same meaning as in the Counter Terrorism and Transnational Organised Crime Act [CAP 313];
transaction has the meaning given by section 3;
Unit means the Financial Intelligence Unit established under section 4.
2 Meaning of reporting entity
Each of the following is a reporting entity:
(b) a licensee within the meaning of the Financial Institutions Act [CAP 254];
(c) a licensee within the meaning of the International Banking Act [CAP 280];
(d) a company licensed under the Vanuatu Interactive Gaming Act [CAP 261];
(e) a person licensed under the Casino (Control) Act [CAP 223];
(f) a person carrying on a business under the Gaming (Control) Act [CAP 172] or the Lotteries Act [CAP 205];
(g) a foundation within the meaning of the Foundation Act No. 38 of 2009;
(h) an association within the meaning of the Charitable Associations (Incorporation) Act [CAP 140];
(i) a person carrying on electronic business under the E-Business Act [CAP 264];
(j) a licensee within the meaning of the Company and Trust Services Provider Act No. 8 of 2010;
(k) a credit union registered under the Credit Unions Act [CAP 256] or a co-operative society registered under the Co-operative Societies Act [CAP 152];
(l) a person carrying on a business:
(i) of administering or managing funds on behalf of an international company within the meaning of the International Companies Act [CAP 222] or any other person; or
(m) a person carrying on a business of an insurer, an insurance intermediary, a securities dealer or a futures broker;
(n) a person (other than a person mentioned under paragraph (a), (b) or (c)), carrying on a business of:
(i) exchanging currency or value; or
(ii) collecting, holding, exchanging or transferring currency or value, or otherwise negotiating transfers of currency or value, on behalf of other persons; or
(iii) preparing payrolls on behalf of other persons in whole or in part from currency collected; or
(iv) delivering currency including payroll;
(o) a lawyer, notary or accountant that provides services to a client relating to all or any of the following:
(i) buying or selling of real estates, business entities or properties;
(ii) managing of currencies, securities or other assets;
(iii) managing of banks, savings or securities accounts;
(iv) organising contributions for the creation, operation or management of legal persons or legal arrangements;
(v) creating, operating or managing legal persons or legal arrangements;
(p) a person (whether or not the person is a trust or company service provider) providing all or any of the following services:
(i) forming or managing legal persons or legal arrangements;
(ii) acting (or arranging for another person to act) as a director or secretary of a company, a partner of a partnership, or a similar position in relation to other legal persons;
(iii) providing a registered office, a business address or accommodation, correspondence or an administrative address for a company, a partnership or any other legal person or legal arrangement;
(iv) acting (or arranging for another person to act) as a trustee of a trust or a similar position in other form of legal arrangements;
(v) acting (or arranging for another person to act) as a nominee shareholder for another person;
(q) a person carrying on a business of:
(i) dealing in bullions, precious metals or precious stones; or
(ii) issuing, selling or redeeming traveller’s cheques, money orders or similar instruments; or
(iii) collecting, holding and delivering currency as part of a business or providing payroll services;
(r) a person carrying on the business of:
(i) lending, including consumer credit or mortgage credit, and financing of commercial transactions; or
(ii) financial leasing; or
(iii) issuing and managing means of payment (such as credit and debit cards, cheques, bankers’ drafts and electronic money); or
(iv) issuing financial guarantees and commitments; or
(v) trading for the person’s own account or for the account of customers in money market instruments (such as cheques, bills, certificates of deposit), foreign exchange, financial futures and options, exchange and interest rate instruments, commodity futures trading or transferable securities; or
(vi) participating in securities issues and providing financial services relating to such issues; or
(vii) money brokering; or
(viii) mutual funds or, individual or collective portfolio management; or
(ix) safekeeping and administration of cash or liquid securities on behalf of other persons; or
(x) trustee administrator or investment manager of a superannuation scheme, other than a scheme under which contributions are made by salary deductions and withdrawals are for limited purposes such as retirement; or
(xi) dealing in real estate or sale or hire of motor vehicles; or
(xii) dealing in property (other than real estate) exceeding VT 1 million or such other amount as may be prescribed;
(s) any other person prescribed for the purpose of this provision.
(1) A transaction means any deposit, withdrawal, exchange or transfer of fund whether:
(c) by electronic or other non-physical means; or
(d) in satisfaction, whether in whole or part, of any contractual or other legal obligation.
(2) Without limiting subsection (1), a transaction includes the following:
(a) the establishment of a business relationship; or
(b) the opening of an account; or
(c) the engagement of a service; or
(d) any payment made in respect of a lottery, bet or other game of chance; or
(e) the establishment or creation of a legal person or legal arrangement; or
(f) such other transactions as may be prescribed.
PART 2 FINANCIAL INTELLIGENCE UNIT
4 Establishment of the Financial Intelligence Unit
The Financial Intelligence Unit is established within the State Law Office.
5 Functions and powers of the Unit
(1) The Unit has the following functions:
(a) to receive suspicious transaction reports and other reports, and information, in accordance with the provisions of this Act; and
(b) to analyse and assess any report or information refer to under this Act; and
(c) to gather information, whether or not it has been requested by the Director from an assisting entity, or a ministry, department or agency of the Government or any person, for the purposes of this Act; and
(d) to disclose information derived from any report or information provided to the Director under this Act, to an assisting entity if the Director has reasonable grounds to suspect that the report or information is relevant to:
(i) the detection, investigation or prosecution of a person for a money laundering offence, a financing of terrorism offence or any other serious offence; or
(ii) the commission of a money laundering offence, a financing of terrorism offence or any other serious offence; or
(iii) an act preparatory to a financing of terrorism offence; or
(iv) the enforcement of this Act, the Proceeds of Crime Act [CAP 284] or any other Act prescribed by the Regulations; and
(e) to collect information that the Director considers relevant to a money laundering offence, a financing of terrorism offence or any other serious offence, whether or not the information is publicly available, including information in commercially available databases or databases maintained by the Government; and
(f) to enter into agreements or arrangements under section 6, and exchange information in accordance with those agreements or arrangements; and
(g) to request information from an assisting entity to assist with any analysis or assessment mentioned in paragraph (b); and
(h) to direct in writing a reporting entity to take such steps as the Director considers appropriate in relation to any information or report received by the Director so as to facilitate any investigation that is anticipated or being undertaken by the Director or an assisting entity; and
(i) to undertake inquiries as may be requested in writing by an assisting entity where appropriate; and
(j) to do checks on any person if requested by the Vanuatu Investment Promotion Authority or a Ministry, Department or agency of the Government; and
(k) to provide feedback to reporting entities and other relevant persons regarding outcomes relating to the reports or information given under this Act; and
(l) to conduct research into money laundering and terrorism financing trends and developments and recommend on detecting and deterring measures against money laundering and terrorism financing activities; and
(m) to carry out examinations of reporting entities to ensure their compliance with this Act; and
(n) to issue guidelines to reporting entities in relation to customer due diligence obligations, record keeping obligation, reporting obligations, identification of suspicious transactions and money laundering and financing of terrorism typologies; and
(o) to provide training programs for reporting entities in relation to customer due diligence obligations, record keeping obligations and reporting obligations;
(p) to compile statistics and records, and to disseminate information within Vanuatu; and
(q) to register reporting entities and screen office bearers of reporting entities; and
(r) to ensure reporting entities comply with this Act and its Regulations; and
(s) to educate the public and create awareness on matters relating to money laundering and the financing of terrorism.
(2) The Unit has the power to do all things that are necessary or convenient to be done for or in connection with the performance of its functions.
6 Agreements and arrangements
(1) The Director may, with the written approval of the Minister, enter into a written agreement or arrangement with an assisting entity regarding the exchange of information under this section.
(2) The Minister may only give approval under subsection (1) if the Director and the assisting entity have reasonable grounds to suspect that an information may be relevant to detecting, investigating or prosecuting:
(a) a money laundering offence, a financing of terrorism offence or any other serious offence; or
(b) an offence that is substantially similar to such an offence.
(3) An agreement or arrangement entered into under subsection (1) must:
(a) restrict the use of the information to purposes relevant to investigating or prosecuting a money laundering offence, a financing of terrorism offence or any other serious offence, or an offence that is substantially similar to such an offence; and
(b) stipulate that the information is to be treated in a confidential manner and not to be disclosed without the express consent of the Director and the assisting entity.
(4) In the absence of an agreement or arrangement entered into under subsection (1), the Director may exchange information with an assisting entity having functions and duties similar to those of the Unit, provided that:
(a) the use of the information is restricted to purposes relevant to investigating or prosecuting a money laundering offence, a financing of terrorism offence or any other serious offence, or an offence that is substantially similar to such an offence; and
(b) the information is to be treated in a confidential manner and not to be disclosed without the express consent of the Director and the assisting entity.
7 Appointment of the Director
(1) The Attorney General is to appoint a Director of the Unit.
(2) The Director is to perform the functions and exercise the powers of the Unit specified under this Act.
(3) The Director may authorise in writing, a senior officer of the Unit, subject to any terms and conditions as may be specified by the Director, to carry out any functions or powers of the Director under this Act.
8 Staff of the Unit
(1) The Attorney General may employ other staff of the Unit as he or she considers necessary for the proper and efficient performance of the functions of the Unit.
(2) The Attorney General is to determine the terms and conditions of employment of the persons referred to in subsection (1).
PART 3 REGISTER OF REPORTING ENTITIES
9 Register of reporting entities
(1) The Director must establish and maintain a register of reporting entities.
(2) A reporting entity must not provide a service or establish a business relationship with a customer if its name and details are not entered on the register of reporting entities.
(3) If a reporting entity makes a written application in the prescribed form to the Director for the reporting entity’s name and details to be entered on the register of reporting entities, the Director must enter the reporting entity’s name and details on the register if the reporting entity’s name is not already entered on that register.
(4) If a reporting entity’s name or details are entered on the register and the reporting entity has changed its name or details, the reporting entity must inform the Director in writing of the changes made.
(5) A reporting entity who contravenes subsection (2), (3) or (4), commits an offence and is liable on conviction:
(a) in the case of an individual - to a fine not exceeding VT25 million or imprisonment for a term not exceeding 5 years or both; or
(b) in the case of a body corporate - to a fine not exceeding VT100 million.
10 Removal of entries from the register of reporting entities
The Director may remove upon the request of a reporting entity, the name and details of the reporting entity from the register.
11 Access to the register of reporting entities
(1) A reporting entity may request the Director, in writing, to inform the reporting entity whether the name of a specified person is entered on the register of the reporting entities.
(2) The Director must comply with the reporting entity’s request as may be prescribed.
PART 4 CUSTOMER DUE DILIGENCE REQUIREMENT
12 Obligation to identify customer
(1) A reporting entity must carry out the prescribed identification process if a person:
(a) opens an account with a reporting entity; or
(b) engages the services of a reporting entity; or
(c) enters into a business relationship with a reporting entity; or
(d) conducts an occasional transaction that exceeds the prescribed threshold under section 27 or 28.
(2) A reporting entity must carry out a prescribed identification process on:
(a) a person conducting a transaction; and
(b) a person on whose behalf a transaction is being conducted; and
(c) a beneficial owner,
if the reporting entity has reasonable grounds to believe that the person is undertaking a transaction on behalf of another person.
(3) A reporting entity must carry out a prescribed identification process on the customer if the reporting entity:
(a) carries out an electronic currency transfer for the customer, other than an electronic currency transfer referred to under subsection 37(2) or (4); or
(b) suspects that the customer is involved in proceeds of crime, a financing of terrorism or a serious offence; or
(c) suspects that the transaction involves proceeds of crime, or may be used for financing terrorism or for committing a serious offence; or
(d) has doubts on the veracity or adequacy of the customer identification or information it had previously obtained.
(4) A reporting entity who contravenes subsection (1), (2) or (3), commits an offence and is liable on conviction:
(a) in the case of an individual - to a fine not exceeding VT2,500,000, or imprisonment for a term not exceeding 2 years or both; or
(b) in the case of a body corporate - to a fine not exceeding VT10,000,000.
13 Necessity of due diligence to conduct transaction
(1) If satisfactory evidence of the identity or verification of a person is not produced to or obtained by a reporting entity under this Part within a prescribed timeframe and under a prescribed circumstance, a reporting entity must prepare a suspicious transaction report for the Director as if the transaction were a transaction made under section 20.
(2) The reporting entity must not proceed any further with the transaction unless directed to do so by the Director.
(3) A reporting entity who contravenes subsection (1) or (2), commits an offence and is liable on conviction:
14 Reporting entity to maintain business relationship under true name
(1) A reporting entity must maintain an account or establish a business relationship with the true name of the customer.
(2) A reporting entity who contravenes subsection (1), commits an offence and is liable on conviction:
(b) in the case of a corporate body - to a fine not exceeding VT10,000,000.
15 Establishing a business relationship under false or misleading names
(1) A reporting entity must not:
(a) establish a business relationship with a person using a false, fictitious or misleading name; and
(b) open an account with a person using one of the person’s name, if the person has 2 or more different names, unless the person has disclosed the other name or names to the reporting entity.
(2) If a person is using a particular name in the person’s dealings with a reporting entity and discloses to it a different name or names under which the person is commonly known, the reporting entity must:
(a) make a record of the disclosure of the persons name; and
(b) give the Director a copy of that record if requested to do so in writing by the Director.
(3) For the purposes of this section, a person establishes a business relationship in a false name if the person:
(a) in establishing the business relationship uses a name other than a name in which the person is commonly known; or
(b) does any act or thing in relation to the business relationship (whether by way of making a deposit or withdrawal or by way of communication with the reporting entity concerned or otherwise) and, in doing so, uses a name other than a name by which the person is commonly known.
(4) A reporting entity who contravenes subsection (1) or (2), commits an offence and is liable on conviction:
(a) in the case of an individual - to a fine of not exceeding VT 10 million or imprisonment for a term of not exceeding 4 years or both; or
(b) in the case of a body corporate – to a fine of not more than VT 50 million.
16 Obligation to verify the identification of customer
(1) A reporting entity must undertake a prescribed verification process within a prescribed timeframe if after carrying out or purporting to carry out the prescribed customer identification process:
(a) a prescribed event happens; or
(b) a prescribed circumstance comes into existence; or
(c) a prescribed period ends.
(a) in the case of an individual – to a fine not exceeding VT 1 million or imprisonment for a term not exceeding 1 year, or both; or
(b) in the case of a body corporate – to a fine not exceeding VT 5 million.
17 Obligation to conduct regular customer and transaction due diligence
(1) A reporting entity must undertake a prescribed on-going due diligence process to monitor its account, service or relationship with each of its customers to identify, mitigate and manage the risk it may reasonably face with its customer that might involve money laundering, financing of terrorism or other serious offences.
(2) In addition to subsection (1), a reporting entity must:
(a) record its findings in writing; and
(b) upon a written request by the Director, make available such findings to the Director.
(3) A reporting entity who fails to comply with subsections (1) and (2), commits an offence and is liable on conviction:
18 Obligation for intermediaries or third parties introducers
(1) If a reporting entity relies on intermediary or a third party to undertake its obligations under this Part or to introduce customers to it, the reporting entity must:
(a) satisfy itself that the intermediary or third party is regulated and supervised, and has measures in place to comply with the requirements under this Part and Part 5; and
(b) ensure that copies of identification data and other relevant documentation relating to the requirements under this Part is made available to the intermediary or the third party upon request without delay; and
(c) immediately obtain the information required under this Part.
(a) record its finding in writing; and
PART 5 RECORD KEEPING REQUIREMENT
19 Obligation to keep records
(1) A reporting entity must keep records of all transactions in such a manner as to enable the transactions to be readily reconstructed at any time by the Director.
(2) Without limiting subsection (1), the records must contain the prescribed information.
(3) A reporting entity must keep the records for a period of 6 years after the completion of the transaction.
(4) A reporting entity must keep:
(a) a record of any suspicious transaction, suspicious activity or other report made under Part 6; and
(b) a record of any enquiry relating to money laundering or the financing of terrorism made to the Director; and
(c) a record of a finding referred to under subsection 18(2).
(5) A reporting entity must keep records provided under subsection (4) for a period of 6 years after the date on which the report or the enquiry was made.
(6) A reporting entity must keep:
(a) if evidence of a person’s identity and verification is obtained under Part 4:
(i) a record that indicates the kind of evidence that was obtained; and
(ii) either a copy of the evidence or information that enables a copy of it to be obtained; and
(b) a record referred to under subsections 15(2) and 17(2).
(7) A reporting entity must keep records provided under subsection (6) for a period of 6 years after the closure or termination of the account, service or business relationship.
(8) A reporting entity must make:
(a) a record of the adoption of an AML and CFT Procedure Manual; and
(b) retain the AML and CFT Procedure Manual for a period of 12 months.
(9) A reporting entity who contravenes subsection (1), (2), (3), (4), (5), (6), (7) or (8) commits an offence and is liable on conviction:
PART 6 TRANSACTION AND ACTIVITY REPORTING REQUIREMENT
20 Obligation to report suspicious transaction
(1) A reporting entity must make a report of the transaction or attempted transaction to the Director not later than 2 working days if the reporting entity suspects or has reasonable grounds to suspect that a transaction or attempted transaction involves proceeds of crime or is related to terrorist financing.
(3) A reporting entity who fails without reasonable excuse to comply with subsection (1) or (2), commits an offence and is liable on conviction:
(a) in the case of an individual - to a fine not exceeding VT25,000,000, or imprisonment for a term not exceeding 5 years, or both; or
(b) in the case of a body corporate - to a fine not exceeding VT100,000,000.
21 Obligation to report suspicious activity
(1) A reporting entity must make a report of the activity or attempted activity to the Director not later than 2 working days if a reporting entity suspects or has reasonable grounds to suspect that an activity or attempted activity involves proceeds of crime or is related to terrorist financing.
(2) The reporting entity must not proceed any further with the activity unless directed to do so by the Director.
(a) in the case of an individual - to a fine not exceeding VT 25 million or imprisonment for a term not exceeding 5 years, or both; or
22 Obligation to report transaction conducted by prescribed entities
(1) If a prescribed entity conducts or seeks to conduct a transaction through or by using a reporting entity and such transaction or attempted transaction is deemed to be a suspicious transaction involving proceeds of crime or is related to terrorist financing, the reporting entity must make a report of the transaction or attempted transaction to the Director not later than 2 working days.
(b) in the case of a body corporate - to a fine not exceeding VT 100 million.
23 Obligation to report transaction involving terrorist property
(1) A reporting entity must make a report of the transaction or attempted transaction and provide the report to the Director not later than 2 working days if a reporting entity has information in its possession concerning any transaction or attempted transaction which it suspects involves terrorist property, property linked to terrorists or terrorist organisations.
(3) A reporting entity who fails without reasonable ground to comply with subsection (1) or (2), commits an offence and is liable on conviction:
24 Obligation to report certain transaction with no legitimate purpose
(1) This section applies if a reporting entity suspects that a transaction or attempted transaction:
(a) is complex, unusual or large and does not have any apparent or visible economic or lawful purpose; or
(b) is part of an unusual pattern of transactions that does not have any apparent or visible economic or lawful purpose.
(2) The reporting entity must make a report of the transaction or attempted transaction and provide the report to the Director not later than 2 working days after forming the suspicion.
(3) The reporting entity must not proceed any further with the transaction unless directed to do so by the Director.
(4) A reporting entity who fails without reasonable grounds to comply with subsection (2) or (3), commits an offence and is liable on conviction:
25 Supervisory body or auditor to report suspicious transaction
(1) This section applies if a supervisory body or an auditor of a reporting entity has reasonable grounds to suspect that a transaction or an attempted transaction or information that it has in its possession involves proceeds of crime or is related to financing of terrorism.
(2) The supervisory body or the auditor of the reporting entity must make a report of the transaction or attempted transaction, or the information to the Director not later than 2 working days after forming the suspicion.
(3) A supervisory body or an auditor of a reporting entity who fails without reasonable grounds to comply with subsection (2), commits an offence and is liable on conviction:
26 Form of reports
(1) A report under section 20, 21, 22, 23, 24 or 25 must be made in the prescribed form and may be sent to the Director by way of fax or electronic mail or hand delivery.
(2) A report may be given orally including by telephone.
(3) If an oral report is given under subsection (2), a written report must be prepared in accordance with subsection (1) within 24 hours after the oral report is given.
(4) A reporting entity who fails without reasonable grounds to comply with subsection (1) or (3), commits an offence and is liable on conviction:
(a) in the case of an individual - to a fine not exceeding VT2,500,000, or imprisonment for a term not exceeding 2 years, or both; or
27 Obligation to report large cash transaction
(1) A reporting entity must make a report to the Director on any single transaction of an amount in cash which exceeds the prescribed threshold or its equivalent in foreign currency.
(2) Subsection (1) does not apply if the originator and beneficiary of the transaction are reporting entities under section 2 of this Act and acting on their own behalf.
(3) A report made under this section must be in the prescribed form and be provided to the Director within the prescribed time frame.
(4) A reporting entity may apply in writing to the Director to be exempted from reporting under subsection (1), if the transactions are deposits or withdrawals by an established customer of that reporting entity.
(5) A reporting entity who contravenes subsection (1), commits an offence and is liable on conviction:
28 Obligation to report international currency transfers
(1) A reporting entity must make a report to the Director:
(a) on any electronic transmission of currency or other currency transfer out of Vanuatu that exceeds the prescribed threshold or its equivalent to foreign currency in the course of a single transaction; or
(b) on any electronic receipt of currency or other currency receipts from outside Vanuatu that exceeds the prescribed threshold or its equivalent to foreign currency in the course of a single transaction; or
(c) if the reporting entity uses a service of a third party to receive or transmit electronic transaction or other currency transfer that exceeds the prescribed threshold or its equivalent to foreign currency in the course of a single transaction.
(2) A report made under subsection (1) must be:
(a) made in the prescribed form; and
(b) sent to the Director within the prescribed time frame.
29 Avoidance of section 27 or 28
(1) This section applies to a reporting entity if the reporting entity conducts 2 or more transactions that are of an amount below the prescribed threshold under section 27 or 28.
(2) A reporting entity who conducts the transactions for the sole or dominant purpose of ensuring or attempting to ensure that a report in relation to the transactions is not made under section 27 or 28, commits an offence and is liable on conviction:
(3) Without limiting subsection (2), all or any of the following may be taken into account by a court in deciding whether a person has committed an offence against that subsection:
(a) the manner and form in which the transactions were conducted;
(b) the amount of the currency involved in each transaction;
(c) the aggregate amount of the currency involved in the transactions;
(d) the period of time over which the transactions occurred;
(e) the interval of time between the transactions;
(f) the locations at which the transactions were initiated or conducted;
(g) any explanation made by the person concerned as to the manner or form in which the transactions were conducted.
30 Obligation to report cross-border movement of currency
(1) The authorized officers prescribed under the Currency Declaration Act No. 7 of 2009 must send a report to the Director of all:
(a) physical currency; and
(b) bearer negotiable instruments,
entering or departing Vanuatu.
31 Obligation to submit AML and CTF Compliance Report
(1) A reporting entity must lodge an AML and CTF Compliance report with the Director.
(2) The AML and CTF compliance report must be:
(b) sent to the Director within a prescribed time frame.
(3) A reporting entity who contravenes subsection (1), commits an offence and is liable on conviction:
(a) in the case of an individual - to a fine not exceeding VT1 million or imprisonment for a term not exceeding 1 year or both; or
(b) in the case of a body corporate - to a fine not exceeding VT5 million.
32 Obligation to submit additional Information
(1) The Director may request any further information from a reporting entity if the reporting entity has made a report on a transaction, attempted transaction, activity or attempted activity or has provided information under this Part to the Director.
(2) A reporting entity who fails without reasonable grounds to comply with subsection (1), commits an offence and is liable on conviction:
PART 7 ANTI-MONEY LAUNDERING AND COUNTER-TERRORISM FINANCING PROGRAM
33 AML and CTF Procedure Manual
(1) A reporting entity must not open accounts, provide services or establish a business relationship with a customer unless the reporting entity has established and maintained an adequate AML and CTF procedure manual.
(2) The AML and CTF Procedure Manual must contain internal policies, processes and procedures:
(a) to implement the reporting requirements under Part 6; and
(b) to implement the customer due diligence requirements under Part 4; and
(c) to implement the record keeping requirements under Part 5; and
(d) to inform the entity’s officers and employees of the laws of Vanuatu about money laundering and financing of terrorism, of the policies, processes and procedures and systems adopted by the entity to deal with money laundering and financing of terrorism; and
(e) to train the entity’s officers and employees to recognise and deal with money laundering and terrorism financing; and
(f) on the role and responsibility of the AML and CTF Compliance officer; and
(g) on the establishment of an audit function which is able to test its AML and CTF processes, procedures and systems; and
(h) on the adoption of systems by the entity to deal with money laundering and terrorism financing.
(3) A reporting entity must give a copy of its AML and CTF Procedure Manual to the Director upon request made to it in writing by the Director.
34 Appointment of AML and CTF Compliance Officer
(1) A reporting entity must appoint a person as AML and CTF compliance officer to be responsible for ensuring the reporting entity’s compliance with the requirements of this Act and the Regulations.
(2) An AML and CTF compliance officer appointed under subsection (1) may be employed on a full time or part time basis and may be an existing member of staff.
(3) A reporting entity must inform the Director in writing of its Compliance officer’s appointment, or any change of appointment or termination of appointment.
(4) A reporting entity who contravenes subsection (1) or (3), commits an offence and is liable on conviction:
(a) in the case of an individual - to a fine not exceeding VT10,000,000 or imprisonment for a term not exceeding 4 years or both; or
(b) in the case of a body corporate - to a fine not exceeding VT50,000,000.
35 Money laundering and terrorism financing risk assessments
(1) The Director may by notice in writing, require a reporting entity to:
(a) carry out a money laundering and terrorism financing risk assessment; and
(b) prepare a written report setting out the results of the assessment; and
(c) provide a copy of the report within the period specified in the notice to the Director.
(2) A report made under subsection (1) must be in the prescribed form.
(3) A reporting entity who fails to comply with any notice under subsection (1), commits an offence and is liable on conviction:
(a) in the case of an individual - to a fine not exceeding VT2,500,000 or imprisonment for a term not exceeding 2 year or both; or
PART 8 CORRESPONDENT BANKING
36 Cross Border Correspondent Banking
(1) This section applies if a reporting entity carries out cross border correspondent banking or has other similar relationships.
(2) A reporting entity must, in addition to its other obligations under this Act, do all of the following:
(a) adequately identify and verify the person with whom it conducts such a business relationship; and
(b) gather sufficient information about the nature of the business of the person; and
(c) determine from publicly available information the reputation of the person and the quality of supervision the person is subject to; and
(d) assess the person’s anti-money laundering and counter-terrorism financing controls; and
(e) obtain approval from senior management before establishing a new correspondent relationship; and
(f) record the responsibilities of the reporting entity and the person.
(3) If a reporting entity allows a person with whom it carries out a cross border correspondent banking relationship to establish accounts in the reporting entity for use by that person’s customers, the reporting entity must, in addition to its other obligations under this Act, be satisfied that that person:
(a) has verified the identity of and is performing on-going due diligence on that person’s customers that have direct access to accounts of the reporting entity; and
(b) is able to provide to the reporting entity customer identification data of the customers referred to in this section upon request.
(4) A reporting entity who contravenes subsection (2), commits an offence and is liable on conviction:
(a) in the case of an individual - to a fine not exceeding VT1,000,000, or imprisonment for a term not exceeding 1 year or both; or
(b) in the case of a body corporate - to a fine not exceeding VT5,000,000.
37 Originator information
(1) A reporting entity must include accurate originator information on an electronic currency transfer and on any other form of currency transfer, and such information is to be recorded as part of the transfer.
(2) Subsection (1) does not apply to an electronic currency transfer that results from a transaction carried out using a credit or debit card, the number of which is included in the information accompanying such a transfer.
(3) Despite subsection (2), if a money transfer is made using a credit or debit card as a means of payment, then subsection (1) applies to such transfer.
(4) Subsection (1) does not apply to an electronic currency transfer or settlement between reporting entities where the originator and beneficiary of the currency transfer are reporting entities acting on their own behalf.
(a) in the case of an individual - to a fine not exceeding VT1,000,000, or imprisonment for a term not exceeding 1 year, or both; or
PART 9 SECRECY AND ACCESS
(1) A person must not disclose any information to any other person:
(a) that a reporting entity, or the supervisory body or auditor of a reporting entity, has formed a suspicion in relation to a transaction or an attempted transaction, or an activity or attempted activity; or
(b) that a report under this Act is made to the Director; or
(c) that information under this Act is given to the Director; or
(d) any other information from which a person to whom the information is disclosed may reasonably be expected to infer any of the circumstances in paragraph (a), (b) or (c).
(2) Subsection (1) may not apply to a disclosure made to:
(a) an officer, employee or agent of a reporting entity who has made or is required to make a report or provide information under this Act for any purpose connected with the performance of that reporting entity’s duties; or
(b) a lawyer for the purpose of obtaining legal advice or representation in relation to the disclosure; or
(c) the supervisory body of the relevant reporting entity; or
(d) an assisting entity or any other person by the Unit under this Act.
(3) An information disclosed to a lawyer under paragraph (2)(b) must not be disclosed to any other person except to a person of the kind referred to under that paragraph, for the purpose of:
(a) the performance of the lawyer’s duties; or
(b) obtaining legal advice or representation in relation to the disclosure.
(4) Nothing in this section prevents the disclosure of any information in connection with, or in the course of, proceedings before a court if the court is satisfied that the disclosure of the information is necessary in the interests of justice.
(5) A person who contravenes subsection (1), commits an offence and is liable on conviction:
(a) in the case of an individual - to a fine not exceeding VT25,000,000, or imprisonment for a term not exceeding 5 years, or both;
(6) A person who contravenes subsection (1):
(a) with intent to prejudice an investigation of a money laundering offence, a financing of terrorism offence or another serious offence; or
(b) for the purpose of obtaining directly or indirectly an advantage or a pecuniary gain for himself or herself or any other person,
commits an offence and is liable on conviction:
(i) in the case of an individual - to a fine not exceeding VT50,000,000, or imprisonment for a term not exceeding 10 years, or both; or
(ii) in the case of a body corporate - to a fine not exceeding VT200,000,000.
39 False or misleading information
If a person making a report or providing information required under Part 3, 4, 5, 6, 7 or 8:
(a) makes any statement that the person knows is false or misleading in a material particular; or
(b) omits from any statement any matter without which the person knows that the statement is false or misleading in a material particular,
(i) in the case of an individual - to a fine not exceeding VT2,500,000, or imprisonment for a term not exceeding 2 years, or both; or
(ii) in the case of a body corporate - to a fine not exceeding VT10,000,000.
40 Legal Professional Privilege
(1) Nothing in this Act requires a lawyer or notary to disclose information which is subject to legal professional privilege.
(2) For the purposes of this Act, an information is privileged information if:
(a) it is a confidential information, whether orally or in writing between:
(i) a lawyer or notary in his or her professional capacity and another lawyer or notary in such capacity; or
(ii) a lawyer or notary in his or her professional capacity and his or her client, whether made directly or indirectly through an agent; and
(b) it is made for the purpose of obtaining or giving legal advice or assistance; and
(c) it is not made for the purpose of committing or furthering the commission of an illegal or wrongful act.
41 Secrecy provision
(1) This section applies if a person ceases to be an officer, employee or agent of the Unit, the Public Prosecutor’s Office or an assisting entity.
(a) any information contained in a suspicious transaction report or other report provided under this Act; or
(b) any information provided under this Act,
except for one or more of the purposes required under subsection (3).
(3) The purposes are all or any of the following:
(a) the detection, investigation or prosecution of a money laundering offence, a financing of terrorism offence or any other serious offence;
(b) the enforcement of this Act, the Proceeds of Crime Act [CAP 284] or any other Act prescribed by the Regulations;
(c) when lawfully required to do so by any court;
(d) such other purposes connected with the performance of the person’s functions or duties under this Act.
(4) A person who contravenes subsection (2), commits an offence and is liable on conviction to a fine not exceeding VT2,500,000, or imprisonment for a term not exceeding 2 years, or both.
A civil or criminal proceedings must not be taken against the Attorney General, the Director or any member or agent of the Unit or any person acting under the direction of the Attorney General or the Director for any act done or omission made in good faith in the discharge or purported discharge of any of the Unit’s functions or powers under this Act.
43 Overriding of secrecy
(1) A reporting entity and an officer, employee or agent of the reporting entity must comply with the requirements of this Act despite any obligation as to secrecy or other restriction on the disclosure of information imposed by any written law or otherwise.
(2) A civil or criminal proceedings must not be taken against a reporting entity or an officer, employee or agent of the reporting entity for complying with its or his or her obligations under this Act despite any written law to the contrary.
(3) To avoid doubt, this section overrides section 125 of the International Companies Act [CAP 222] and section 43 of the Company and Trust Service Providers Act No. 8 of 2010.
44 Liability of directors or officers of bodies corporate
Any director or officer of a body corporate is liable if it is proved that an act or omission that constituted the offence under this Act took place with his or her knowledge, authority, permission or consent.
PART 10 POWERS OF THE DIRECTOR
45 Power to collect information
(1) This section applies to a person if the Director believes on reasonable grounds that:
(a) being a reporting entity; or
(b) being an officer, employee or agent of a reporting entity; or
(c) being an assisting entity or Ministry, Department or agency of the Government; or
(d) being an officer, employee or agent of an assisting entity, Ministry, Department or agency of the Government; or
has information or records relevant to the operation of this Act or Regulations.
(2) The Director may by notice in writing, require a person to give or produce any information or records within a period as specified in the notice.
(3) A notice made under this section must be in the prescribed form.
(4) A person who fails to comply with subsection (2), commits an offence and is liable on conviction:
46 Power to examine
(1) The Director may examine the records and inquire into the business and affairs of any reporting entity for the purpose of ensuring compliance by the reporting entity with Parts 3, 4, 5, 6, 7, 8 and this Part.
(2) Without limiting subsection (1), the Director may do all or any of the following:
(a) at any reasonable time, enter any premises, in which the Director believes, on reasonable grounds, that there are records relevant to ensuring compliance by a reporting entity with Part 4, 6 or 7;
(c) reproduce any record, or cause it to be reproduced from the data, in the form of a printout or other intelligible output and remove the printout or other output for examination or copying;
(3) The owner or occupier of premises under subsection (1) and any person found there must:
(a) give the Director all reasonable assistance to enable him or her to carry out his or her duties; and
(b) provide the Director with any information that he or she may reasonably require for that purpose.
(4) The Director may transmit any information from, or derived from, such examination to an assisting entity if the Director has reasonable grounds to suspect that the information is or may be relevant to:
(a) the detection, investigation or prosecution of a person for a money laundering offence, a financing of terrorism offence or any other serious offence; or
(b) the commission of a money laundering offence, a financing of terrorism offence or any other serious offence; or
(c) an act preparatory to a financing of terrorism offence; or
(d) the enforcement of this Act, the Proceeds of Crime Act [CAP 284] or any other Act as prescribed by the Regulations.
(a) obstructs or hinders or fails to cooperate with the Director in the lawful exercise of the powers under subsection (1) or (2); or
(b) does not comply with subsection (3),
47 Power to enforce compliance
(1) A reporting entity must take all reasonable steps to ensure that it complies with its obligations under this Act.
(2) The Director may in writing direct a reporting entity that has without reasonable excuse failed to comply in whole or in part with any of its obligations under Part 3, 4, 5, 6, 7 or 8 to:
(a) implement such obligations within such time as specified in the direction; and
(b) produce a written action plan in relation to the implementation of its obligations.
(3) The Director may in writing direct a reporting entity to take such steps as the Director considers appropriate in relation to any information or report received by the Director to enforce compliance with this Act.
(4) If a reporting entity fails to comply with a direction under subsection (2) or (3) within the time specified in the direction, the Director may apply to the Supreme Court for an order against the reporting entity to enforce compliance with the relevant obligations.
(5) The Court must not make an order unless it is satisfied that the reporting entity has failed without reasonable excuse to comply in whole or in part with any of its obligations under Parts 3, 4, 5, 6, 7, 8 or 10 and has failed to comply with a direction under subsection (2) or (3).
(6) If a reporting entity fails to comply with a direction under paragraph 5(1)(h), the Director may apply to the Supreme Court for an order against the reporting entity to comply with the direction.
(7) The Court must not make an order unless it is satisfied that the reporting entity has failed without reasonable excuse to comply with the direction given under paragraph 5(1)(h).
48 Power to remove a director, manager, secretary or other officer of a reporting entity
(1) The Director may in writing direct a reporting entity to remove a person who is a director, manager, secretary or other officer of that reporting entity if the Director is satisfied that the person:
(a) is a disqualified person within the meaning of section 49; and
(b) does not meet one or more criteria for fitness and suitability as may be prescribed.
(2) The Director, in directing a reporting entity to remove a person under subsection (1), must give a written notice and reasonable opportunity for the reporting entity and the person to make their submissions on the matter.
(3) The Director must review the submission under subsection (2) and decide whether or not to require the reporting entity to comply with the direction.
(4) The direction made under this section is to take effect on the day specified in the notice, which must be at least 7 days after it is made.
(5) If the Director directs a reporting entity to remove a person, the Director must give a copy of his or her direction to the reporting entity and the person.
(6) A reporting entity who fails to comply with a direction under this section, commits an offence and is liable on conviction:
(a) in the case of an individual – to a fine not exceeding VT2,500,000 or imprisonment for a term not exceeding 2 years, or both; or
(b) in the case of a body corporate – to a fine not exceeding VT10,000,000.
49 Disqualified person
(1) A person is a disqualified person if, at any time, the person:
(b) has been a director or directly concerned in the management of a reporting entity in Vanuatu or any other country which has had its licence revoked or has been wound up by the Court; or
(c) has been convicted by a court for an offence involving dishonesty; or
(d) is or becomes bankrupt; or
(e) has applied to take the benefit of a law for the relief of bankrupt or insolvent debtors; or
(f) has compounded with his or her creditors.
(2) A disqualified person must not act or continue to act as a director, manager, secretary or other officer of any reporting entity unless the Director gives his or her written approval for that person to do so.
(3) A reporting entity that engages or allows a disqualified person to act or continue to act as a director, manager, secretary or other officer commits an offence and is liable on conviction:
(4) A person who contravenes subsection (2) commits an offence and is liable on conviction:
50 Search warrants
(1) The Director may apply to the Supreme Court for a warrant:
(a) to enter premises belonging to, or in the possession or control of, a reporting entity or any officer or employee of the reporting entity; and
(2) The Court must grant the application if he or she is satisfied that there are reasonable grounds for believing that:
(a) the reporting entity has failed without reasonable excuse to comply in whole or in part with Part 3, 4, 5, 6, 7, 8 or 10; or
(b) an officer or employee of the reporting entity has committed or is about to commit a financing of terrorism or a money laundering offence.
PART 11 ANNUAL REPORT, TRANSITIONAL AND MISCELLANEOUS PROVISIONS
51 Destruction of reports
The Director is to destroy a report under this Act received or collected by him or her on the expiry of 6 years:
(a) after the date of receipt of the report if there has been no further activity or information relating to the report or a person named in the report; or
(b) after the date of the last activity relating to the person or report.
52 Annual Reports
(1) The Director must, on or before the end of March of each year, submit an annual report to the Minister on the operations of the Unit for the preceding year.
(2) The Minister must as soon as practicable table a copy of the annual report in Parliament.
(3) The Director must not disclose any information in the report that may directly or indirectly identify:
(a) an individual who provided a annual report or information under this Act to the Director; or
(b) a person about whom a report or information was provided under this Act.
(1) The Minister may make Regulations not inconsistent with this Act:
(2) The Minister may make Regulations prescribing as a money laundering entity a person or group if the person or group has been convicted of money laundering offence or an offence that is substantially similar to such an offence.
54 Transitional arrangements
(1) This section applies to any person who was employed at the Unit immediately before the commencement of this Act.
(2) On and after that commencement, the person is to continue to be employed at the Unit as an employee of the Unit:
(a) on the same terms and conditions; and
(b) in the same position and/or with the same classification,
until such time the person’s employment lawfully ceases or the person’s employment terms and conditions, position or classification lawfully changes.
The Financial Transactions Reporting Act [CAP 268] is repealed.
URL: http://www.paclii.org/vu/legis/num_act/alacfa2014522