The Challenges Of Anti-Money Laundering Legislation In Mexico - Mondaq Mexico - Blogs - VLEX 581727486

The Challenges Of Anti-Money Laundering Legislation In Mexico


Having received international praise for their success in implementing banking controls, Mexico's legislators turned their attention to anti-money laundering in 2012. On 17 October the Federal Act to Prevent and Identify Illegally-Funded Transactions was passed and it came into full force in August 2013.

Article 17 of the Act identifies 15 commercial activities as 'vulnerable', meaning they have a high risk of being used for money laundering. These include: issuing credit cards, service cards, traveller cheques or pre-paid cards; construction; real estate; selling and buying vehicles, jewellery and precious stones and metals; the armouring of vehicles, not for profit organizations, gambling and sweepstakes, international trade, public notaries, and professional rendering of services amongst others.

Alejandro says: "This new law is going to affect many companies in Mexico and, at the moment, it is difficult to understand what is going to happen with the application of this law as no cases have come before the courts yet, so we have no guidance."

Julio adds: "The Act has established an obligation to file certain notices with the Ministry of Finance when carrying out vulnerable activities. What is unclear at the moment is to what extent some of the vulnerable activities should be considered as vulnerable; an intercompany loan is not the same thing as a pawn; however, depending on the interpretation they could both fall within the same vulnerable activity. There is a lot of uncertainty about how this law will be applied."

While it is usual in most jurisdictions for a delay between new legislation being implemented and courts offering guidance about interpretation, in this instance technical difficulties have made the situation more difficult. When the Mexican Ministry of Finance established the portal that notifications are made through, for certain vulnerable activities such as the rendering of services they only allowed individuals to file the notices. This means that firms of attorneys or accountants who might make filings as a corporation are unable to do so unless they do so as individuals, rather than as representatives of their firm. At the time of writing, a much-promised fix had not been implemented.

There are other issues with the new Act. Alejandro points out that the Act is considered as a criminal law, while the activities it covers are administrative. He also mentions that the sanctions are too high, since those range, in some...

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