Anti Money-Laundering

 Will the information transferred by the banks to the “authorized authority” remain confidential? 

Yes.

By law, the information transferred to the “authority” is classified and is not accessible to any unauthorized bodies. Information from the “authority” will only be transferred in by law and for the purposes of investigating money-laundering offenses, protecting national security and fighting terror organizations.

 Will the bank inform the customer when it reports on the customer's transactions to the “authority”?

No.

The law forbids the bank to inform the customer when reporting on its irregular transactions. As aforementioned, the size of the transaction related report is automatic for transactions with a cash value exceeding a specific amount and, a customer, who has an interest in this, can be updated in advance regarding the types of transactions and sums that constituting a report.

 Does the law contradict principles of privacy and banking confidentiality?

Possibly.

However, as in implementing other laws, the Legislature must balance various values. In this case – privacy and banking confidentiality on the one hand and fighting money laundering and its related crimes on the other hand. The Legislature, which was aware of the possible contradiction between these values, has chosen to balance them in the following manner: The information will be transferred to an authorized authority at the Ministry of Justice and not to the police, as is the case in some countries. I.e., future handling of the reports that are transferred to the Israel Money-Laundering Prohibition Authority is under its sole authority and it is entitled to transfer the relevant details to the law enforcement authorities in the State of Israel in accordance with the law.

Furthermore, any information that the bank has, whether or not it was transferred to the Israel Money-Laundering Prohibition Authority or not, is not exposed to any interested bodies whatsoever and is kept in reservoirs under strict data security limitations.

We believe that the benefits from applying the law exceed any possible violation of privacy and that customers will portray an understanding to the requirements of the law.

Disclaimer

The information on this website is for explanative purposes only. It is not to be construed as a legal opinion and/or cannot be used in the framework of any legal processes.