The RS Inspectorate does not supervise money laundering and terrorist financing

18.07.2024. / 16:34

BANJALUKA – The Inspectorate of the Republic of Srpska, as an authorized institution, does not monitor and control the prevention of money laundering and the financing of terrorist activities due to legal deficiencies, it reveals. CAPITAL.

PHOTO: Pixabay

According to the Law on Prevention of Money Laundering and Financing of Terrorist Activities of BiH, which entered into force at the beginning of March this year, the supervision of part of the legal entities covered by this law is the responsibility of the Republic Administration for Inspection Affairs of the Republic of Srpska (RS Inspectorate).

However, in order for the Inspectorate of RS to be able to perform that work and implement the Law on Prevention of Money Laundering and Financing of Terrorist Activities of BiH, it is necessary to make changes to the Law on Republic Administration and the Law on Inspections of RS.

Legal changes are needed in order to form a new inspection sector, that is, the introduction of a new inspection in the Inspectorate of the RS, and that work has not even started yet, which practically means that the Law on Prevention of Money Laundering of BiH is currently a dead letter for all legal entities. which should be controlled by the RS Inspectorate.

The implementation of the law is also hindered by the Council of Ministers of BiH, which, on the proposal of the Ministry of Security of BiH, has to pass numerous by-laws and precisely define the supervision and monitoring of the compliance of obligees with the provisions of this law.

This is for CAPITAL also confirmed in the RS Inspectorate, from which they remind that the Law on Prevention of Money Laundering and Financing of Terrorist Activities entered into force at the beginning of March this year, but also that it defined a transitional period of six months for taxpayers to harmonize their operations, organization, general and internal acts with by him.

“In order for the application of this law in practice to be possible at all, it is necessary for the Council of Ministers of Bosnia and Herzegovina to pass a number of by-laws that are provided for in this law, and which should define all the important issues and circumstances that the obligees of this law should comply with in their business operations”it is stated in the RS Inspectorate’s answer to the questions CAPITAL-a.

Who controls the implementation of the law?

According to the law on prevention of money laundering, the obligees of this law, over whom the RS Inspectorate supervises, are audit companies, bookkeeping and accounting bureaus, as well as tax advisors. In addition to them, it should also control legal entities and entrepreneurs who are not banks and/or are not subject to supervision by authorities responsible for the financial sector, and which provide certain types of services specified in the law, as well as legal entities registered for trade in vessels, vehicles and aircraft, but also the post office, if they provide payment services.

The institutions in charge of supervising the application of this law are the Banking Agency and the Insurance Agency of the RS, the Tax Administration, the Republic Administration for Games of Chance, as well as the Securities Commission. These institutions supervise the work of banks, microcredit organizations, exchange offices, insurance companies, betting shops and casinos and other legal entities.

From this institution, they specify that in their previous work and in accordance with their competences, they did not control the financial operations of economic entities in the sense of controlling and monitoring their transactions or assessing the risk of money laundering and financing of terrorist activities.

“In accordance with the above, the existing inspections of the Inspectorate (such as educational, traffic, forestry, veterinary, water and other inspections) based on the competences defined by the Law on Inspections of the RS, and the nature of the areas under their supervision (education, forestry and hunting, agriculture, urban planning and construction and others) currently do not have the legal possibility to act according to the said law”say the RS Inspectorate.

They confirm that for the purposes of implementing the Law on Prevention of Money Laundering and Financing of Terrorist Activities, in addition to the adoption of by-laws, it is necessary to make changes to the Law on Republic Administration, because the current law does not recognize the implementation of inspection supervision over the prevention of money laundering and financing of terrorist activities as a competence of the RS Inspectorate. .

“In addition, it is necessary to make changes to the Law on Inspections of the RS and define the competence of the inspection authorities in the new area of ​​supervision, which is currently not covered by the Law on Inspections and which is placed under the authority of this authority for the first time. It is also necessary to make corrections to certain by-laws and provide additional personnel, material and financial conditions for the formation of an inspection sector that would carry out supervision in the new area.it is stated in the reply from the RS Inspectorate, which practically confirms that for the implementation of the Law on Prevention of Money Laundering and Financing of Terrorist Activities, it is necessary to form a new inspection.

Who to complain to?!

In addition, additional confusion is introduced by the fact that the law states that the Council of Ministers of Bosnia and Herzegovina adopts regulations, decisions and instructions within three months from the entry into force of the law, and that process passed at the beginning of this month, while the legal deadline for the adoption of by-laws is not specified at all. in which they must be passed.

A special problem related to the implementation of the Law on Prevention of Money Laundering, which is also warned about by the RS Inspectorate, is the right to appeal.

“Inspection supervision is a type of administrative supervision that foresees the possibility of appealing against the inspector’s decision, so the question arises as to which authority, when it comes to the application of this law, has the capacity of a second instance authority that will decide on appeals. It is necessary to define a number of technical and procedural issues more precisely, in order to further consider the implementation of this law from the point of view of our competences”, assessed by the RS Inspectorate.

CAPITAL: D. Momić