On 9th January 2020 the results of the National risk assessment (NRA) of money laundering and terrorism financing were published on the official website of the State Agency for National Security.
As of the date of publication of the NRA results, the obligated persons under Art. 4 of the Measures against Money Laundering Act (MAMLA) have 6-month term, i.e. until 9th July 2020, to comply their internal rules for control and prevention of money laundering (“the Internal rules”) with the MAMLA and the NRA. The persons for whom the obligation to apply anti-money laundering measures has arisen with the entry into force of the new MAMLA shall prepare and adopt Internal rules within the same six-month period.
NRA establishes 32 money laundering and 10 terrorist financing risk events. NRA contains description of each risk event and determines the risk level by assessment of the chances for the risk event occurrence and the significance of its consequences. According to the NRA the high-risk events are, but are not limited to: laundering of money obtained through tax evasion and VAT fraud; laundering of money obtained through public procurement and EU funds frauds; money laundering through investments in the construction and real estate sectors; misuse of companies owned or operated by offshore companies or legal entities administered in the territory of other jurisdictions; misuse of limited liability companies, especially in the presence of complex corporate structures, various persons involved, hidden owners, nominees; utilizing business loans for mixing with funds of illegal origin and completing money laundering through investments in various sectors, and others.
Together with the obligation to comply their Internal rules with the law, the obligated persons shall carry out its own risk assessment. The risk assessment shall comply with and include the results of the NRA.
In order to observe the legal requirements, all obligated persons shall:
- Adopt Internal Rules that shall be in compliance with the requirements of Art.101 of the MAMLA and of the NRA;
- Have its own risk assessment, in compliance with the NRA;
- Apply the anti-money laundering measures in accordance with the Internal rules.
Sanctions for Non-compliance
In the event that SANS stablishes that the adopted Internal rules are not in compliance with the law or the measures provided are not sufficient to achieve the objectives of the law, SANS gives mandatory instructions that shall be observed within 1 month. However, when SANS establishes that a liable person has not adopted Internal rules, it shall be sanctioned by a fine of BGN 1 000 to 10 000 for individuals or a property sanction of 2000 to BGN 20 000 for legal entities.
The team of Dyulgerova and Penkova Law Frim would gladly advise its clients on any matters related to anti-money laundering measures and shall assist you in complying your Internal rules with the law and the NRA.