Last updated 27/10/2010
CENTRAL AUTHORITY FOR REPORTING
According to Decree 74/2005/ND-CP of the Government, dated June 7, 2005 on prevention of and fight against money laundering (“Decree 74”), and Circular 22/2009/TT-NHNN (“Circular 22”) of the State Bank of Vietnam (“SBV”) dated November 17, 2009 guiding the implementation of measures to prevent and combat money laundering, the following State authorities are responsible for reporting on the prevention of and the fight against money laundering:
Anti-Money Laundering Administration (“AMLA”) under the Banking Inspectorate and Supervision Department of the SBV. The duties and powers of the AMLA are provided in Decision 1654/QD-NHNN of the SBV dated July 14, 2009;
OTHER ANTI-MONEY LAUNDERING REGULATOR(S)
On April 13, 2009, the Prime Minister issued Decision 470/QD-TTg to establish the Anti-Money Laundering Steering Committee (“AMLSC”). The AMLSC assists the Prime Minister to administer and co-ordinate the ministries and agencies to fight money laundering. It operates in accordance with rules subsequently provided in Decision 163/QD-BCDPCRT, dated April 12, 2010.
Ministries, ministerial agencies and Government associated agencies are responsible to co-operate and to assist the SBV, the MPS, the Supreme People’s Procuracy, and the Supreme People’s Court in their investigation, prosecution and resolution of money laundering crimes.
The People’s Committees at all levels have a responsibility to co-ordinate with competent State authorities to implement policies, strategies and plans to prevent and fight money laundering.
ARE LAWYERS COVERED BY MONEY LAUNDERING LEGISLATION?
Lawyers, legal consultancies, law offices and legal partnerships have a responsibility to prevent and fight money laundering when they carry out monetary or other asset transactions on behalf of their clients. This requirement is specifically set forth in Decree 74, Article 6.2.(a).
A lawyer may be criminally liable for money laundering pursuant to Order 13/2009/L-CTN of the State President dated June 29, 2009 on promulgation of Law to amend a number of articles of the Penal Code (“Penal Code”).
LIST THE LAWS REGARDING ANTI-MONEY LAUNDERING, INDICATING WHICH LAWS ARE APPLICABLE TO LAWYERS.
There are no anti-money laundering rules which apply specifically to lawyers. However, lawyers are covered by the anti-money laundering provisions in the following legislation:
ARE VISITING LAWYERS SUBJECT TO LOCAL LAWS REGARDING ANTI-MONEY LAUNDERING, AND, IF SO, TO WHAT EXTENT?
Visiting lawyers are subject to local laws on anti-money laundering when they carry out a monetary or asset transaction on behalf of their clients in Vietnam.
LIST ANY MONEY LAUNDERING GUIDANCE FOR LAWYERS (FOR EXAMPLE, LAW SOCIETY OR BAR ASSOCIATION GUIDELINES) CURRENTLY IN PLACE.
There is no such guidance specifically for lawyers.
IS THE LAW SOCIETY/BAR ASSOCIATION INVOLVED IN SUPERVISING OR ENFORCING COMPLIANCE WITH ANTI-MONEY LAUNDERING REGULATIONS?
There are no legal requirements for the Law Society/ Bar Association to supervise or enforce compliance with anti-money laundering regulations.
DESCRIBE CLIENT DUE DILIGENCE REQUIREMENTS, INCLUDING WHEN IT MUST BE UNDERTAKEN BY LAWYERS.
There are no due diligence requirement that must be undertaken specifically by lawyers.
DOES YOUR COUNTRY FOLLOW A RISK-BASED APPROACH TO CLIENT DUE DILIGENCE BY LAWYERS?
There is no common approach to client due diligence by lawyers. It is subject to the nature of a particular transaction.
ARE THERE ENHANCED DUE DILIGENCE MEASURES FOR CERTAIN TYPES OF CLIENTS, FOR EXAMPLE, POLITICALLY EXPOSED PERSONS?
There are no due diligence measures for any particular type of client.
ARE THERE SIMPLIFIED DUE DILIGENCE MEASURES FOR CERTAIN TYPES OF CLIENTS, FOR EXAMPLE, LISTED COMPANIES?
As mentioned above, this is subject to the nature of each transaction, but not to the type of clients.
ARE LAWYERS PERMITTED TO RELY ON THIRD PARTY DUE DILIGENCE? IF YES, PLEASE DESCRIBE.
The law does not address the matter.
WHEN IS A LAWYER UNDER AN OBLIGATION TO REPORT SUSPICIOUS TRANSACTIONS?
According to article 12 of Decree 74, if a lawyer is involved in a transaction of a kind specified in articles 9 and 10, s/he must report it to the AMLA or to a competent State authority.
The report must be made by the lawyer involved in the transaction, and must include the following:
Time and time period for performance of the transaction or for issuance of a transaction order;
Parties involved in the transaction;
Documents and data used by the parties in the transaction; and
Preventive measures already taken.
The report must be made within 48 hours from the occurrence of a transaction specified in Article 9, or upon discovery of a transaction stipulated in Article 10, or within 24 hours of discovery of any sign of criminal activity in a transaction. The Governor of the SBV will indicate the time period within which each type of transaction must be reported.
The lawyer may submit her/his report in writing, by electronic means or in another approved form of communication. If necessary, a report may be promptly made by telephone and confirmed afterwards by one of the above modes.
DOES ATTORNEY/CLIENT PRIVILEGE AND/OR DUTIES OF CONFIDENTIALITY PROVIDE A DEFENCE OR PARTIAL/TOTAL EXCEPTION TO THE REQUIREMENT TO REPORT SUSPICIOUS TRANSACTIONS?
There is currently no law on such a defence or exception to the requirement to report a suspicious transaction.
DOES LOCAL LAW PROVIDE ANY CRIMINAL AND/OR CIVIL INDEMNITY TO A LAWYER WHO HAS REPORTED A SUSPICIOUS TRANSACTION?
Yes. A lawyer who makes a report or provides information about a suspicious transaction is deemed not to breach the provisions of law on confidentiality of client information in accordance with article 12.4 of Decree 74. This is to protect a lawyer from violation of her/his duty to keep information confidential as stipulated in the Law on Lawyers of Vietnam.
Under the Law on Lawyers, a lawyer must not disclose information about cases, matters, or her/his clients which s/he learns during the course of practice, except where a client provides written agreement or where the law stipulates otherwise. Decree 74 provides a defence for a lawyer who breaches the duty of confidentiality in which s/he provides information about a suspicious client transaction to the relevant authorities.
ONCE A SUSPICIOUS TRANSACTION REPORT HAS BEEN FILED, IS A LAWYER ALLOWED TO PROCEED WITH THE LEGAL ADVICE/TRANSACTION, AND, IF SO, MUST CONSENT FROM AUTHORITIES BE OBTAINED FIRST?
A lawyer is obliged to refuse to perform the following monetary or asset transactions:
- A suspicious transaction involving a person whose name is on the Statistical and Warning List maintained by the MPS; or
- A transaction which the lawyer has a reasonable basis to believe is related to a criminal activity.
Based on informal guidance from the AMLA, if such a transaction is reported to the AMLA, the lawyer may continue to provide legal consultancy on the matter. However, once the AMLA, upon investigation, determines the transaction to be suspicious, the lawyer may be requested by the AMLA to discontinue working on the transaction.
IS THERE A TIPPING-OFF PROHIBITION? IF YES, PLEASE DESCRIBE.
A lawyer is not allowed to inform a person involved in a suspicious transaction on which s/he has provided a report to the authorities.
DESCRIBE ANY RESTRICTIONS ON ACCEPTING A NEW CLIENT.
There are no restrictions other than the need to perform a due diligence investigation in suspicious circumstances as such circumstances are detailed in Articles 9 and 10 of Decree 74..
ARE THERE ONGOING MONITORING REQUIREMENTS FOR EXISTING CLIENTS? IF YES, PLEASE DESCRIBE.
There are no ongoing monitoring requirements for existing clients.
DESCRIBE ANY OTHER WAYS IN WHICH LAWYERS ARE AFFECTED BY ANTI-MONEY LAUNDERING LEGISLATION.
A lawyer’s failure to comply with Decree 74 may result in administrative sanctions as follows:
- A monetary fine of VND 5 million to VND 15 million for a failure to report to the AMLA or to a competent State authority if the circumstances require; or
- A monetary fine of VND 10 million to VND 30 million if s/he:
- Informs a party involved in a concerned transaction of the reported contents or of information that has been provided to the AMLA or a competent State authority;
- Delays her/his response to the AMLA or the competent body;
- Fails to comply with requests from the AMLA or the competent body without a legitimate reason.
In addition to a warning or a monetary fine, a lawyer’s practice certificate may be withdrawn for a definite or indefinite term.
Lawyers may also be examined under the Penal Code for involvement in money laundering activities. A prison term from one to 15 years may be imposed. Also, an offender may be subject to the following additional penalties:
Confiscation of whole or part of property;
A fine equal to three times the amount of money or the value of property used for the commission of a crime; or
Being banned from holding certain posts, professional practice or doing certain jobs for one to five years.
HAVE LAWYERS IN YOUR JURISDICTION BEEN IMPLICATED IN MONEY LAUNDERING, INCLUDING ANY TYPE OF COMPLAINT, ARREST OR PROSECUTION?
There are no reports on cases/lawsuits/prosecutions in connection with money laundering that involves a lawyer in Vietnam.
HAS THE FINANCIAL ACTION TASK FORCE (FATF) CONDUCTED A MUTUAL EVALUATION OF THIS COUNTRY, AND, IF SO, WHAT WERE THE FINDINGS CONCERNING LAWYERS’ COMPLIANCE WITH THE FATF 40+9 RECOMMENDATIONS?
Vietnam is not a member of FATF. However, Vietnam became the 33rd member of the Asia Pacific Group on Money Laundering (APG) in May 2007 . The APG conducted the second round of a mutual evaluation of Vietnam in November 2008. The first mutual evaluation report was made on July 8, 2009 (“2009 Report”).
According to Recommendations 24 and 25 of the 2009 Report, Vietnam has not yet implemented AML/CFT (Combating the Financing of Terrorism) requirements, nor issued guidelines for Designated Non-Financial Businesses and Professions (“DNFBPs”) (including lawyers) to comply with Decree 74. Vietnam lacks an effective regulatory and supervisory framework to monitor and ensure that DNFBPs comply with their AML obligations. Particularly, the Bar Association of Vietnam indicated that no guidelines for lawyers have been issued in relation to Decree 74. The Bar Association of Vietnam highlighted difficulties in the application of requirements to report suspicious transaction in the context of client confidentiality.
The APG recommended in their report that relevant DNFBP regulatory and supervisory agencies should work closely with AMLA and the SBV in order to develop a strategy to amend Decree 74, and to enhance the implementation of FATF requirements by DFNBPs.
The APG has worked directly with government agencies and ministries on developing anti-money laundering policies and laws. It has also worked with financial institutions to assess the effectiveness of measures to prevent criminal financial transactions.
The APG uses FATF's 40 + 9 Recommendations as their principal guidelines for implementation of effective AML/CFT standards and measures. The APG uses similar mechanisms to those used by the FATF to monitor and facilitate progress for effectively implementing international standards.
Since its inception, the APG has worked closely with FATF. The APG and FATF have reciprocal rights of attendance at each others meetings as well as reciprocal sharing of documents and reciprocal participation in working groups.
The APG and FATF are involved in mutual evaluations of shared member jurisdictions.
Information provided by:
Mai Thi Minh Hang and Dao Hong Diu
Russin & Vecchi
Hanoi Central Office Building, 11/F
44B Ly Thuong Kiet Street
- APG Members.
- About APGML, Relationship to the FATF.