Client Update | Banking & Finance

Author:Herzog Fox & Neeman
Profession:Herzog Fox & Neeman
 
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Prohibition of Money Laundering Order (Identification, Reporting and Record-Keeping Requirements of Financial Services Providers to Prevent Money Laundering and Terror Financing) (Amendment), 5778-2018

On November 15th, 2018 a draft of the Prohibition of Money Laundering Order (Identification, Reporting and Record-Keeping Requirements of Financial Services Providers to Prevent Money Laundering and Terror Financing) (Amendment), 5778-2018 (the "Order") was submitted for approval by the Constitution, Law and Justice Committee of the Knesset. The draft proposes the application of provisions of the Order to Service Providers in a Financial Asset, in a manner that will significantly expand its application.

As previously published, the Regulations of Supervision of Financial Services (Regulated Financial Services) (Exemption from License Requirement) (Temporary Regulations) (the "Regulations") grant various exemptions from the license requirement for providers of credit and providers of financial assets services.

The draft Order proposes expanding the application of the Order such that the requirements of the order will also apply to (a) Financial Service Providers entitled to an exemption from licensing under the Regulated Financial Services law (insofar as they are not financial entities already subject to obligations under the Prohibition on Money Laundering Law, including banking corporations under the Banking (Licensing) Law and entities listed in the Third Schedule to such law) and (b) Financial Service Providers entitled to an exemption according to the above Regulations, including foreign entities.

The significance of broadening the application of the Order is that said exempt entities will still have to comply with obligations regarding the...

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