Strip 026 Number No. 32(336) dated 08/15/2001

Farewell, laundered Russia!

The President signed the law "On combating the legalization (laundering) of proceeds from crime." The West's task has been completed. There is hope that Russia will be excluded from the blacklist of countries that do not fight “dirty” money. However, you will have to wait a long time.

A few days ago I was interested in an advertising video broadcast on one of the Moscow radio stations. Nothing unusual at first glance - some real estate company was frightening real estate buyers with the fact that from February 1 of next year the anti-money laundering law would come into force, and everyone would be under the hood of financial intelligence. In general, buy apartments now and in bulk. It’s strange, I thought, the advertising appeal is, of course, correct (the main thing is to have time to launder the money), but what does the anti-money laundering law have to do with it?
The text of the law “On combating the legalization (laundering) of proceeds from crime,” signed by the president last week, strictly speaking, does not correspond to its name. It does not define those actions that can be called laundering “dirty” money. And, for example, in the European Framework Anti-Money Laundering Law there is an article according to which a lawyer who does not currently defend the interests of his client in court can receive up to seven years in prison if he advises him how to launder money. We have nothing of the kind to speak of. But Article 6 lists in detail the transactions that banks are required to report to the authorized body.
By the way, this list cannot but cause a slight chill in any Russian citizen. Imagine, you came to an exchange office and bought (or sold) $20 thousand. A trifle, if you think about it. But no, according to the new law, the bank that owns the exchanger is obliged to report this operation to the appropriate place. Or another example. A citizen bought shares for 601 thousand cash rubles - and was blacklisted. And this despite the fact that according to the new version of the law on foreign exchange control, it is allowed to buy shares for $75 thousand. And so on for 15 types of financial transactions. Using cash will become simply dangerous.
"So here it is, the fight against 'dirty' money!" - someone might exclaim. And he will be wrong. The fact is that all these 15 points are aimed at strengthening financial control in general, and not against money laundering in particular. The legislator simply mixed two concepts into one. Laundering is the specific actions of a specific individual or legal entity aimed at concealing the source of money (by the way, in the domestic anti-money laundering law, for some reason, we are talking only about banks; one might think that only bank employees know how to launder money). And they must be spelled out in detail in the law, otherwise the law will simply be a profanity.
The fact that a banker reports a suspicious transaction to the relevant government agency is, in principle, good. We in the West have long been expected to strengthen the fight against financial scams. Law enforcement may even be on the trail of an international drug trafficking ring. But their lawyer (notary, or anyone), whose proven guilt will be that he advised drug dealers how to place money, will escape criminal prosecution. Because, firstly, he is not a bank employee, which means that according to our law he is not obliged to inform. And secondly, giving advice in our country is not a punishable act, although there is an anti-money laundering article (174th) in the Criminal Code.
By the way, if the bank does not report a suspicious transaction, then under the new law nothing will happen to it - in the worst case, they will threaten to revoke the license. But this can only be done on the basis of the law on banks and banking activities, as well as instructions from the Central Bank. But they did not introduce the necessary tightening of the rules. In general, strengthening general financial control through the anti-money laundering law is simply irrational. For this purpose, there is a law on credit and financial organizations. In any case, experts from the international anti-money laundering organization FATF (Financial Action Task Force or Money Laundering), who studied the Russian anti-money laundering bill in May of this year, emphasized exactly this.
In general, they were clearly in a hurry with the anti-money laundering law - they had to be in time for the July G8 summit in Genoa. There, by the way, Vladimir Putin was praised for his efficiency, they even promised to remove Russia from the FATF blacklist. But I think the FATF itself will not rush, but will wait to see how the new law shows itself in practice.
As for Moscow realtors, it would be better if they frightened people with control over purchases. According to the articles of the first part of the Tax Code, which have been in force for more than a year, tax services collect information about any transactions, regardless of their volume, if they concern real estate, securities, art, gold bars and foreign cars (the Ministry of Taxes does not want to waste time on domestic cars).
And one last thing. If anyone still intends to launder money quickly, I give the address: Stockholm, Old Town, courtyard not far from the Irish bar, three steps down, ask Slobo. This Serb (the bars there are owned by Serbs) takes any amount.
KONSTANTIN SMIRNOV

Magazine "Kommersant Money" No. 32 dated 08/15/2001, p. 26

Authors:

Konstantin Smirnov