AML regulations are getting an overhaul from the CBE:The Central Bank of Egypt (CBE) issued a circular (pdf) on Sunday upgrading its anti-money laundering (AML) controls and scrapping the 2008 regulations in a bid to tighten monitoring of cash flow. Banks will have a six-month window to implement the new measures.

What for? The new rules focus on keeping taps on clients' activities and transfers — particularly transactions made in USD and credit card deposits — to ensure compliance with international laws, a government source told Enterprise. Recent practices spotted in greenback certificates and a lax approach when it comes to questioning the source of USD deposits — a quick fix for Letters of Credit crisis — have prompted the CBE to raise the bar for monitoring recent cash flows, the source added.

What’s under the spotlight?

  • Large or frequent cash deposits or withdrawals that are inconsistent with the client’s profile.
  • Deposits by different parties into a client’s account without a clear purpose.
  • Large or frequent FX transactions without a need-to basis.
  • Large or frequent transfers to / from parties near border crossings or in high-risk countries.
  • Deposits that are immediately withdrawn after being deposited.
  • Large or frequent transfers from foreign e-payment companies or companies known for working with crypto.

Tightening the reins on USD from unknown sources: The new rules partially reverse a no-questions-asked approach implemented by banks back in July, where they offered to take in USD for FCY deposit certificates without inquiring about the source of the funds. The policy was among many emergency measures taken to attract foreign currency amid the ongoing FX crisis.

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