ACTIVITIES OF SPECIALLY AUTHORIZED BODIES OF THE GROUP OF SEVEN

Abstract

The article examines the functioning of financial intelligence units in the countries that are part of the Group of Seven. International recommendations based on the use of a risk-based approach to the creation and functioning of specially authorized bodies are disclosed. The recommendations provide for the creation of a center for receiving and processing information from reporting entities in the field of financial monitoring. The minimum acceptable requirement is to send data on suspicious transactions. It was determined that the vast majority of financial intelligence units in this group of countries are of the administrative type and are part of other government bodies. Only in the UK and Japan specially authorized bodies operate within the framework of a law enforcement model that allows financial intelligence to investigate crimes, conduct searches and make arrests. Five of the seven analyzed countries require reporting entities to send reports on threshold transactions, which are generated when an established monetary threshold is exceeded and do not depend on the level of risk of the client or financial transaction. An increase in the number of reports submitted on suspicious and threshold transactions of clients is identified. It was found that the number of threshold reports significantly exceeded the volume of suspicious transaction reports sent by primary financial monitoring entities to financial intelligence units. Such statistics confirm the thesis of the priority use of the administrative type of financial intelligence for the purposes of processing large volumes of data. Significant similarities were found between the systems for combating money laundering and terrorist financing in the Group of Seven countries and the financial monitoring system of Ukraine. It is proposed to apply in Ukraine a procedure for sending threshold transaction reports similar to the procedures in the Group of Seven countries, which would avoid the risks of not providing such information to a specially authorized body due to the failure to detect signs of a threshold transaction by reporting entities.