Anti-Money Laundering. Changes Related to Background Analysis

On March 21, 2013 the Argentine Central Bank (the "Central Bank") issued Communication "A" 5408 (the “Communication”) amending the rules related to the background analysis relating to anti-money laundering and terrorism financing matters in the following regulations: (a) regulation on representatives of foreign financial entities not authorized to operate in Argentina, (b) credit cooperatives (cajas de crédito cooperativas) Law No. 26,173), and (c) foreign exchange brokers.

The most significant changes that the Communication makes are the following:

(a) Regarding representatives (and the alternate representative as well) of foreign financial entities not authorized to operate in Argentina: The "Sworn Statement regarding Politically Exposed Person" (the "PEP Sworn Statement") must be filed with the authorization request. It has also been clarified that the anti-money laundering and terrorism financing procedural handbooks must contain the particularities of the activity in accordance with the regulations issued by the Financial Information Unit (“UIF”).

(b) For credit cooperatives (Law No. 26,173): It has been stated that the formulas regarding "Personal background of the authorities of financial institutions" must be filed with the authorization request according to the template posted on the Central Bank’s website (www.bcra.gov.ar) with respect to the members of the Board of Directors, Executive Management Committee and Supervisory Committee. In addition to that, such persons must submit the PEP Sworn Statement and the Certificate of Criminal Records issued by the National Registry of Recidivism (the "Certificate of Recidivism").

The requirements of the preceding paragraph shall also be met in the case of equity subscribing partners of at least AR$ 40,000 (the “Subscribing Partners”). Also, the Subscribing Partners shall be checked with respect to: (i) conviction for offenses of anti-money laundering and/or terrorism financing and/or if they are listed as terrorist or as part of a terrorist organizations in the list issued by the Security Council of the United Nations; (ii) the availability of sufficient funds when they do not came from the sale of assets (which has to be stated in a certification issued by an independent public accountant).

In addition, they must prepare an anti-money laundering and terrorism financing procedural handbook that must contain the particularities of the activity in accordance with the regulations issued by the UIF.

(c) Foreign exchange brokers: It has been stated that, as a precondition to obtain the proper authorization they have to: (i) submit the PEP Sworn Statement; (ii) the Certificates of Recidivism; and (iii) the anti-money laundering procedural handbook that must contain the particularities of the activity in accordance with the regulations issued by the UIF.