Last updated: 07/07/2009
CENTRAL AUTHORITY FOR REPORTING
Financial Analysis Unit of the Treasury Ministry (Unidad de Análisis Financiero).
OTHER ANTI-MONEY LAUNDERING REGULATOR(S)
ARE LAWYERS COVERED BY MONEY LAUNDERING LEGISLATION?
Lawyers are not expressly covered by the anti-money laundering obligations that are imposed onto financial institutions and other designated non-financial businesses and professions.
However, all individuals are covered by the anti-money laundering legislation in Panama, as long as the activity undertaken by them is related to the anti-money laundering laws of Panama.
LIST THE LAWS REGARDING ANTI-MONEY LAUNDERING, INDICATING WHICH LAWS ARE APPLICABLE TO LAWYERS.
ARE VISITING LAWYERS SUBJECT TO LOCAL LAWS REGARDING ANTI-MONEY LAUNDERING, AND, IF SO, TO WHAT EXTENT?
All individuals are covered by the anti-money laundering legislation in Panama, so long as the activity undertaken by them is in relation to the anti-money laundering laws of Panama.
LIST ANY MONEY-LAUNDERING GUIDANCE FOR LAWYERS (FOR EXAMPLE, LAW SOCIETY OR BAR ASSOCIATION GUIDELINES) CURRENTLY IN PLACE.
There are currently no guidance notes in place.
IS THE LAW SOCIETY/BAR ASSOCIATION INVOLVED IN SUPERVISING OR ENFORCING COMPLIANCE WITH ANTI-MONEY LAUNDERING REGULATIONS?
According to a CFATF evaluation report, lawyers do not need to belong to a professional association in order to practice. Also, any codes of ethics of any association are not legally enforceable. There are rules established by law that lawyers need to follow.
However, the Bar Association is not involved in supervising and enforcing any compliance.
DESCRIBE CLIENT DUE DILIGENCE REQUIREMENTS, INCLUDING WHEN IT MUST BE UNDERTAKEN BY LAWYERS.
Client due diligence involves:
- ‘Know your customer’, which means obtaining and verifying identification of the client and the beneficial owner. This includes obtaining full name, profession, passport information, certification of beneficial owner and article of incorporation (list not exhaustive);
- Recording retention requirements for no less than 5 years;
- Reporting suspicious transactions;
- Reporting any cash transactions in excess of the B10,000 threshold;
- Monitoring of transactions on a weekly basis;
- Monitoring of account holders' transactions on a bi-annual basis.
However, lawyers are not subject to the AML laws. Yet under Executive Decree 498 of 1994, lawyers have a minimum requirement of knowing the client and maintaining enough information to identify him.
DOES YOUR COUNTRY FOLLOW A RISK-BASED APPROACH TO CLIENT DUE DILIGENCE BY LAWYERS?
ARE THERE ENHANCED DUE DILIGENCE MEASURES FOR CERTAIN TYPES OF CLIENTS, FOR EXAMPLE, POLITICALLY EXPOSED PERSONS?
There are obligations to adopt enhanced due diligence measured for politically exposed persons. These mirror the FATF recommendations and include:
- Establishing risk management systems to determine whether the client is a PEP;
- Obtaining senior management’s or directors’ approval for establishing accounts and business relationships;
- Determining source of wealth and funds;
- Conducting ongoing monitoring of account transactions.
ARE THERE SIMPLIFIED DUE DILIGENCE MEASURES FOR CERTAIN TYPES OF CLIENTS, FOR EXAMPLE, LISTED COMPANIES?
Institutions are not allowed to apply simplified client due diligence measures when identifying/ verifying the identity of the client or beneficial owner.
ARE LAWYERS PERMITTED TO RELY ON THIRD PARTY DUE DILIGENCE? IF YES, PLEASE DESCRIBE.
As lawyers do not have any obligations towards AML legislation, they rely heavily on banks to gather more in-depth information about their clients, beneficial owners and source of funds and to report any suspicious transactions to the regulator.
WHEN IS A LAWYER UNDER AN OBLIGATION TO REPORT SUSPICIOUS TRANSACTIONS?
Every person and entity subject to anti-money laundering regulations has the obligation to report suspicious transactions to the UAF (Unidad de Análisis Financiero - Financial Analysis Unit of the Treasury Ministry).
However, the law does not state an obligation specifically on lawyers to report suspicious transactions.
DOES ATTORNEY/CLIENT PRIVILEGE AND/OR DUTIES OF CONFIDENTIALITY PROVIDE A DEFENCE OR PARTIAL/TOTAL EXCEPTION TO THE REQUIREMENT TO REPORT SUSPICIOUS TRANSACTIONS?
DOES LOCAL LAW PROVIDE ANY CRIMINAL AND/OR CIVIL INDEMNITY TO A LAWYER WHO HAS REPORTED A SUSPICIOUS TRANSACTION?
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?
IS THERE A TIPPING-OFF PROHIBITION? IF YES, PLEASE DESCRIBE.
DESCRIBE ANY RESTRICTIONS ON ACCEPTING A NEW CLIENT.
There are no particular restrictions for lawyers on accepting a new client.
ARE THERE ONGOING MONITORING REQUIREMENTS FOR EXISTING CLIENTS? IF YES, PLEASE DESCRIBE.
There are ongoing monitoring requirements for certain customers based on a pre-determined threshold.
DESCRIBE ANY OTHER WAYS IN WHICH LAWYERS ARE AFFECTED BY ANTI-MONEY LAUNDERING LEGISLATION.
HAVE LAWYERS IN YOUR JURISDICTION BEEN IMPLICATED IN MONEY LAUNDERING, INCLUDING ANY TYPE OF COMPLAINT, ARREST OR PROSECUTION?
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?
A 2006 evaluation report by the CFATF found Panama to be mostly compliant with the 40+9 Recommendations as a whole. However, it highlighted the need to extend these obligations to the legal profession. They recommended that lawyers in Panama be obliged to:
- Conduct client due diligence;
- Monitor transactions and business relationships of their client;
- Be required to report suspicious transactions to the regulator;
- Manage an internal control check as well as adopt a risk-based approach to clients.
Although there has not been any recent evaluation of the current situation, a report by the US Department of State has suggested that Panama has started to adopt some amendments suggested by the CFATF.
Information provided by:
Ms Ana Lucrecia Tovar de Zarak
Fábrega, Molino & Mulino
Samuel Lewis Ave., 53 Street
Omega Building, Mezzanine
Official Website: www.fmm.com.pa
E-mail : firstname.lastname@example.org