Offical Gazette No:
08.11.1999
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Law No: 55/1999 |
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Short
Title |
1. This Law may be cited as the Prevention
of Money Laundering Law. |
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First Part
General
Provisions
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Interpretation |
2.
In this law unless the context otherwise requires : "Bank”
means, banks operating under Banking Law of the Turkish Republic of Northern
Cyprus, "Ministry"
means, the Ministry responsible for Economic and Financial Affairs, "Real persons or corporate
bodies responsible for giving information" means, banks, co-operative
societies, finance companies, insurance and reassurance companies,
intermediary corporations of capital markets, portfolio management companies,
administrators of investment funds, those engaged in the sale and purchase of
precious metals, stones or jewellery, authorised institutions specified in
the Foreign Exchange Law, those engaged in the sale and purchase of immovable
property for the purpose of trade and those acting as intermediaries of same,
operators of games of change, foreign exchange bureaus, State Lotteries
Administration, accountants and/or auditors. “Not negotiable and order cheque
or payment order” means, cheques or other payment orders which the payee may
only lodge to his account with a bank. "Office" means, the
office of Money, Foreign Exchange and Development Fund. "Illicit
Money" means, all kinds of material benefit and value obtained from;
trafficking in or trade of narcotic drugs and psychotropic substances which
affect the psychic state; unlawful possession, hiding, smuggling or trade of
fire arms, parts of same and ammunitions; organ and tissue transplant; man
slaughter offence; use of a minor or one who is mentally retarded or of any
other person against his will for any unlawful purpose; secure benefits from
a person for international terrorism through black mail or brute force;
spying and industrial or technological spying; all kinds of money and
valuable documents obtained by bribery and corruption and efforts and
attempts to obtain goods and income in the manner enumerated above. "Money Laundering"
means, the evaluation of illicit money acquired by persons through commitment
of predicate offences enumerated above for the purpose of securing compliance
with the law; the acquirement by others of illicit money known to have been
obtained in this manner; possession, use by acquirers or by others, change of
hands, concealment or its removal abroad; for the purpose of assisting the
perpetrator to evade the legal consequences of the offences stated above, the
change of the source or place of illicit money, actions to obviate the proof
thereof and attempts to this end. "Board"
means, Illicit Money Supervision Board. "Payee"
means, real person or corporate body to whom payment will be effected. "Cash
Money Limit” means, 20,000 US dollars and/or its equivalent in other
currencies including legal tender. "Legal
Tender" means, Turkish Lira which is in circulation as official money in
the Turkish Republic of Northern Cyprus. |
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Second Part Provision regarding cash money
limit, Identification and giving of
information |
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Cash Money Limit |
3. Persons
and corporations obliged to give information shall inform the Office by lists
işlemlerin, kimlerin nam ve hesabına yapıldığını showing cash transactions in
excess of cash money limit and in whose name and account they were made,
within the first week following the month during which the transaction took
place. As regards incoming and outgoing transfers they shall inform the
Office solely in respect of transactions about which they have doubts. The
procedure and principles regarding this information will be arranged in
accordance with notification to be published by the Ministry in the Official
Gazette. |
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Transactions exceeding
cash money limit |
4. All payments exceeding cash money
limit shall be effected by not negotiable and crossed order cheques or by not
negotiable and crossed payment orders. |
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The
obligation to identify |
5. Officials and persons and
corporate bodies obliged to give information are required to identify their
clients or parties to the transaction. Also, regarding payment order
instructions in the name of a payee the identification of the person giving
the order and recording thereof is obligatory. Arrangements regarding
identification are made by the Ministry. |
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Documents acceptable
in identification |
6. Identification is effected by
obtaining a convincing photocopy of the identity card, passport or driving
licence issued by official departments. As regards corporate bodies a copy of
the document regarding registration, a document showing that the person
acting in the name of the corporate body is empowered to represent the
corporate body and the document showing authorised signatures or the circular
of authorised signatures. |
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Applications |
7. Where banks are suspicious they
are obliged to identify persons applying to them for business irrespective
of whether or not the cash money limit is exceeded and to notify this
information forthwith to the office or other empowered bodies specified by
the Office. In the light of the decision to be given by the Office at the end
of the investigation the matter may be referred to the Illicit Money
Supervision Board to start legal proceedings. |
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Incoming
Transfers |
8. As regards bank transfers in
favour of residents of the Turkish Republic of Northern Cyprus payment in
cash may not be made to the payee in excess of the cash money limit. Incoming
transfer may only be lodged into the account of the payee with the bank or
payment may be made by cheque. |
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Outgoing
Transfers |
9. Where bank transfers to be made
by residents of the Turkish Republic of Northern Republic of Northern Cyprus
are in excess of the cash money limit the amount to be transferred must be paid
to the bank by cheque or by debiting the account with the bank of the person
making the transfer. |
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The
obligation to
give of documents and information |
10. Officials and persons and corporate
bodies are obliged to co-operate with officers authorised by the Office and
to give all kinds of information and documents in respect suspicious
transactions. Those who are required by the office or the Board to give
information and documents cannot avoid giving such information or documents
by pleading special provisions of their respective laws. |
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Secrecy of information |
11. Information regarding
suspicious transactions or identity of persons investigated or proceeded
against by the office cannot be disclosed to persons who are party to the
transactions concerned or to any other body outside the Board. Also no
information or hint may be given to real persons or corporate bodies under
suspicion, to the effect that information has been or will be given against
them. |
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The obligation of officials not to
disclose information |
12.Persons serving in the office, members of the Board
or persons empowered by court may not disclose to
any person or body the information and documents acquired by them and the
identity of persons from whom such information has been obtained, without
court order except for the purpose of giving testimony in an investigation to
the parties concerned or in court. |
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Disclosure not contravening
secrecy principle |
13.Irrespective as to whether or not there is contrary
provision in any law, officers of the bank or its external auditors giving information
and/or documents to the Office, do not commit a breach of the secrecy
principle and such persons are immune from proceedings under the said
principles. |
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The
obligation to disclose to the Office and to
the bank |
14. (1) |
Where it is established that income
under suspicion constitutes illicit money officers empowered and the persons
and corporate bodies obliged to give information are required to inform the
office of these transactions within 3 working days at the latest from the
date on which the transaction has been ascertained. The procedure and principles regarding information
and the principles of operation of the office on this subject are arranged by
the Ministry through a notification published in the Official Gazette. |
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(2) |
Where in the course of carrying
out the audit within powers given to them by law or in any other manner, the
officers empowered ascertain records of income suspected of being illicit
money, they are obliged to give information to the Board. |
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Third Part
The establishment of Illicit Money
Supervision Board. Its Meetings, Duties and Powers. |
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The establishment of Illicit Money Supervision
Board |
15. (1) |
Illicit Money Supervision Board is
established to evaluate reports prepared by the office for the
prevention of money laundering, to carry out examination in the light of this
information and to submit its findings to court. |
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(2) |
Illicit Money Supervision Board
consists of the following persons and representatives. |
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(A) |
Representative of the Ministry |
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(B) |
Manager of the Department of
Money, Foreign Exchange and Development Fund. (Natural Members) |
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(C) |
Representative of the Department of
Customs and Excise. |
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(D) |
Representative of the Central Bank
of the Turkish Republic of Northern Cyprus. |
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(E) |
Representative of the Director
General of Police. |
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Meetings of the Board |
16. (1) |
Representative of the Ministry is
the chairman of the Board |
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(2) |
The Board at its first meeting,
chooses an assistant chairman from among the members to perform the duties of
the chairman in the absence of the chairman. |
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(3) |
The Board meets at least once a
month upon the call of the chairman. The Board may have further meetings
where necessary. |
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(4) |
The quorum required for meeting
and decision of the Board is the simple majority of the total number of
members. Where votes are equal the chairman of the Board has a casting vote.
Members of the Board may not abstain in voting. The natural member does not
have voting right. |
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(5) |
Decisions of the Board are
recorded in the minute book and are signed by members present at the
subsequent meeting at the latest. No decision may be taken by circularising
members. |
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(6) |
Decisions of the Board include the
following |
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(A) |
Date and Number of meeting |
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(B) |
Names and surnames of those
participating in the meeting. |
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(C) |
C. Names and surnames of those not
participating in the meeting. |
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(D) |
The result of voting and where
necessary the reasons advanced by members for the way voted by them. |
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Duties and powers
of the Board |
17.
(1) |
The Board after scrutinising the
reports submitted by the office and where necessary
demanding more detailed information and documents, decides for
necessary action by relying on the information and documents submitted. |
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(2) |
Where the Board concludes from the
information and documents that there are serious findings and evidence
suggesting money laundering, it refers the matter to the Attorney General for
the purpose of taking measures regarding rights and amounts due to interested
party or parties. |
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(3) |
The Board may avail itself from
the technical services of consultants deemed suitable for the purpose of
making investigation in connection with the money laundering report and may
authorise such persons to examine all kinds of documents on the matter. |
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The
Board's criteria in respect of suspicious transactions |
18. (1) |
The following are the criteria for
doubtful transactions which will enable the Board to make investigation: |
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(A) |
Where in respect of the transaction, there is
unwillingness to give information which should normally be given by everybody;
difficulties are confronted in acquiring information regarding
identification; too little or untrue information is given; document submitted
is suspected to be false; making of misleading statements on financial
position; transaction not consistent with the declared purpose. |
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(B) |
Transfers of abnormally large
amounts from countries where offences are committed in respect of narcotic
drugs and smuggling and there are terrorist organisations; or from centres outside
the borders or from these countries and outside centres. |
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(C) |
Where it is established that there is abnormal increase in the
accounts of the person with its bank or other depositories, and that large
amounts of idle money are kept in these accounts. |
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(D) |
The transfer of large amounts of
money to addresses and accounts outside those normally dealt with by the
client; in a manner inviting suspicion. |
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(E) |
Large movements of cash or remittance
of large amounts from outside the country in the name or account of a person
who has bad reputation and does not possess a specific business, commercial
past and infra structure. |
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(F) |
Generally speaking transfer of
large amounts of money into or outside the country without the use of an
account, realisation of electronic fund transfers without adequate
explanations and the demand for payment of same in cash. |
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(G) |
The maintenance of more than one account
by the person with the same depository in an unaccustomed manner, these
accounts totalling large amounts when taken together or the division into
separate accounts of the total transaction, each below the scope of
disclosure with the idea of avoiding disclosure of continuous information. |
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(H) |
Lodgement by many people into the
same account without a reasonable explanation or transfer into the same
account from several separate accounts. |
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(I) |
Where accounts are opened with foreign
banks for the purpose of transferring funds thereto by persons whose
transactions within the country are too small to necessitate the operation of
a bank account, or the transfer after a short while into transitional
accounts of these amounts with foreign banks without any other operation. |
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(J) |
Existence of accounts
disproportionate to the business carried on and the transfer of funds
effected between these accounts; transitions effected in these accounts,
clearly not connected with commercial purposes; payment to persons not
connected in any way with the person or company in an unaccustomed manner. |
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(K) |
Borrowing large amounts and
settlement of same in a short time in an unexpected manner without a reasonable
explanation. |
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(L) |
Obtaining credit within
the country by showing an account outside the country as guarantee, upon
non-payment of this loan securing conditions for seizure by the creditor of funds
in the account shown as guarantee and bringing same into the country; or
where a loan has been secured within the country in the normal manner its
settlement by transfers of offshore banks outside the country. |
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(M) |
In the application for
credit nondisclosure of convincing information as to where the loan will be
utilised and non-submission of clear information as to repayment of the loan.
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(N) |
Monies of nearly equivalent totals
leaving or coming into the country at approximately near dates. |
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(O) |
Increasing the frequency of
transfers by division of the total amount. |
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(P) |
Large amounts of transfers into or
outside the country without indicating the account number. |
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(2) |
Types of doubtful transactions
listed above are meant to be a guide. It is possible that a doubtful
transaction may take place in a different manner or nature though not
conforming to the types indicated above if the manner and nature of the
transaction invited suspicion such transaction may also be investigated. |
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(3) |
According to principles of reciprocity the Board may exchange
information and documents or sign agreements with responsible authorities in
other countries in respect of money laundering. |
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Money
Laundering Offence |
19. Money laundering by persons arising from: All kinds of material benefit and value obtained from; trafficking in or trade of narcotic drugs and
psychotropic substances which affect psychic state; unlawful possession, hiding, smuggling
or trade of fire arms, parts of same and ammunitions; organ and tissue
transplant; manslaughter offence; use of a minor or one who is mentally retarded or of any other person
against his will for any unlawful purpose; secure benefits from a person for
international terrorism through black mail or brute force; spying and
industrial or technological spying;
all kinds of money and valuable documents obtained by bribery and corruption
and efforts and attempts to obtain goods and income; commit an offence. |
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Offence
and penalty |
20. (1) |
Authorised persons
engaged in investigation or members of the Board may not disclose
information obtained by them in the course of their examination to
anybody other than the court or other
authorised persons. Those who are shown to have disclosed such information
commit an offence and upon conviction are liable to a fine up to 10 billion
Turkish Lira or imprisonment up to ten years or to both. |
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(2) |
Person or persons who are shown to
have committed doubtful acts above the cash money limit and/or those
attempting this and/or those attempting to take illicit money outside the
country commit an offence and upon conviction are liable to a fine up to 10
billion Turkish Lira or imprisonment up to 10 years or to both. In such cases
amounts in excess of the cash money limit are confiscated by official bodies
and are dealt with in accordance with the decision of the court. |
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(3) |
Persons and/or administrators who are
shown to have contravened sections 3.4.5.6.7.8.9.10.11.12.13 and 14 of this
law commit an offence and upon conviction are liable to a fine up to 10
billion TL or to imprisonment up to 10 years or to both. |
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(4) |
Real persons or corporate bodies
who are shown to have contravened section 19 of this Law Commit an Offence
and upon conviction are liable to a fine up to 15 billion TL or to
imprisonment up to 15 years or to both. |
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Power
of courts to confiscate |
21. In offences committed contrary
to provisions of this law the courts have powers to confiscate money or
material values which constitute the subject matter of the proceedings. |
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Fourth Part Transitional
Provisions |
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Transitional Section Actions pending
Establishment of the Board |
1.
Pending legal establishment of Illicit Money Supervision Board the duties and
powers of the Board are carried out by the Department of Money, Foreign
Exchange and Development Fund. |
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Fifth Part Final Provisions |
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Power
of administration |
22.
This Law is administered by the Ministry responsible for Economic and
Financial Matters. |
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Coming into Force |
23.
This law comes into force from the date of its publication in the Official
Gazette. |
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