| New Anti-Money Laundering Law in Effect in Mexico Francisco Rivero, Kenneth E. Broughton and Pablo Quinones - Lexology | |
| go to original October 18, 2013 |
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On October 17, 2012, Mexico passed the Ley Federal para la Prevención e Identificación de Operaciones con Recursos de Procedencia Ilícita (the "Anti-Money Laundering Law" or "AMLL"). The AMLL represents a major sea change in the way in which cash transactions (even intra-company) are handled in Mexico.
The AMLL and its accompanying regulations impose stringent duties on a broad array of Mexican companies or foreign companies transacting business in Mexico. Companies that effectuate certain cash transactions, engage in real estate ventures, or serve as financial institutions (among others) in Mexico may now be required to meet new identity verification, information gathering, and reporting requirements.
The AMLL’s stated objective is to protect Mexico’s economy and financial system from transactions that potentially involve illegal funds. The AMLL tasks the Secretaría de Hacienda y Crédito Público (the Ministry of Finance) and Mexico’s Attorney General with promulgating and enforcing regulations to assist in the identification, investigation, and prosecution of transactions involving illegal funds. Possible sanctions for failure to comply include:
- Fines up to 100 percent of a transaction’s underlying value;
- Revocation of permits; and
- Potential prison terms of up to 10 years.
Read the rest at Lexology
Examples of some of the activities and reporting requirements that may be impacted include:
|
Activity |
Identity Verification Triggered |
Reporting Requirement Triggered |
Ban Triggered |
|
Granting of secured or unsecured credit or loans, acting as a surety, by entities other than financial institutions |
Always |
$8,107.24 USD |
|
|
Gaming, raffles, lotteries, sweepstakes |
$1,641.67 USD |
$3,258.06 USD |
$16,214.64 USD |
|
Issuance or marketing of service, credit, prepaid cards, and all stored value cards not issued by a banking institution where issuer maintains a business relationship with acquirer, instruments allow transfer of funds, or are marketed from time to time |
Aggregate monthly expenses > $4,066.22 USD (credit) |
$6,490.85 USD $3,258.06 USD (pre-paid cards) |
|
|
Issuance or marketing of traveler’s checks by entities other than financial institutions |
Always |
$3,258.06 USD |
|
|
Construction, real estate development, title conveyance intermediaries, creation of liens and encumbrances, involving purchase and sale transactions of real property |
Always |
$40,536.52 USD |
$40,536.52 USD (purchase/sale) $16,630.40 USD (lease) |
|
Marketing and brokerage of precious metals, gems, jewelry, or watches except transactions involving Mexico’s central bank |
$4,066.22 USD |
$8,107.24 USD |
$16,630.40 USD |
|
Marketing of and dealership in new and used motor vehicles, aircraft, or maritime vessels |
$16,630.40 USD |
$32,429.20 USD |
$16,630.40 USD |
|
Armoring services |
$12,173.54 USD |
$24,321.88 USD |
$16,630.40 USD |
|
Cash transportation and custody services, except those carried out by Mexico’s central bank and securities depositary institutions |
Always |
$16,630.40 USD |
|
|
Certain real estate lease transactions |
$8,107.24 USD (monthly) |
$16,630.40 USD (monthly) |
$40,536.52 USD |
|
Purchase/sale of shares or equity |
$16,630.40 USD |
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