AKK Zrt.

Legal regulations of preventing money laundering

Monday,17.11.2003

The Act LXXXIII of 2001 on the fight against terrorism, on tightening up the provisions on the prevention of money laundering and on the ordering of restrictive measures extends the scope of the Act XXIV of 1994 on the prevention and hindering of money laundering on the representations of foreign companies in Hungary, and on organizations providing financial services in the real estate branch, traders of jewelry and goods in the precious metal branch, organizations selling cultural goods on auctions or as commissioners, and attorneys (law offices) managing lawyer’s deposits, public notaries and auditors keeping money, valuables, or securities in custody and auditors, in the case of individual entrepreneurs on their employees and family members taking part in the business, and on customs authorities. In addition it created the detailed rules of the so-called denomination procedure to eliminate anonym deposits.

When entering into a business contact the financial service provider has to identify the client, his agent or the person authorized to disposing if a written contract is to be signed too. In case an identification obligation is prevailing, the client has to disclose to the financial service provider the genuine owner’s name in a written form, if he or she proceeds on behalf of or in the name of an other person. If the person of the genuine owner is doubtful, the financial service provider requests the client to make a written statement on the genuine owner. Without this statement the financial service provider refuses to execute the order.

The amendment stipulates the method, the documents, and data to be laid down needed to the identification as statutory requirements.

The client has to inform the financial service provider on the changes in the data laid down during the process of identification and disclosed in the statement