Practice Areas

What is Money Laundering?

Whoever deposits, withdraws, converts or transfers funds, goods or related rights that come directly or indirectly from criminal activities, in order to hide or cover up their illicit origin, or to help evade the legal consequences of their acts to whoever has participated in the commission of said criminal activities, inside or outside the country, shall be punished with imprisonment from five to fifteen years and a fine of fifty to two thousand five hundred minimum monthly wages in force for commerce, industry and services at the time the corresponding sentence is pronounced.
Money and asset laundering shall also be understood as any operation, transaction, action or omission aimed at concealing the illicit origin and legalizing goods and securities derived from criminal activities committed within or outside the country.

What are the current regulations?

In the case of El Salvador it is the LAW AGAINST MONEY AND ASSET LAUNDERING, LAW AGAINST MONEY AND ASSET LAUNDERING REGULATION, INSTRUCTIONS OF FINANCIAL INVESTIGATION UNIT FOR THE PREVENTION OF MONEY AND ASSET LAUNDERING, SPECIAL LAW AGAINST ACTS OF TERRORISM.

Who is the Anti Money Laundering regulator?

The Financial Investigation Unit of the Attorney General's Office.

Are all companies required to comply with the Anti Money Laundering Law?

Yes, all commercial and mixed economy companies, associations and foundations, regardless of their economic activity, are obligated subjects and must establish the procedures and policies required by law.

Since what moment must a new company comply with the Anti Money Laundering Law?

From the moment of its creation.

Are all Persons obliged to comply with the Anti Money Laundering Law?

No, only those persons who exercise any of the economic activities established in the Law:

• Importers or Exporters of Agricultural Products and Supplies, and used or new vehicles.
• Persons who make systematic or substantial transfers of funds, who function as Pawnbrokers or grant loans.
• Casinos and Gaming Houses.
• Commercialize Metals and Precious Stones.
• Real Estate Brokers.
• Travel Agencies.
• Air, land and sea transport companies.
• Sending and receiving parcels and remittances.
• Construction.
• Private Security Companies and Importers and Marketers of Firearms, Ammunition, Explosives and Similar Items.
• Hotel companies.
• Corporate and Trust Service Providers.
• National and International Investors.
• Drugstores, Pharmaceutical Laboratories and Pharmacy Chains.

What are the obligations established by the Anti Money and Asset Laundering Act and the Financial Investigation Unit (FIU) Regulations?

• Report to the FIU any single or multiple cash operation or transaction, regardless of whether it is considered suspicious or not, that exceeds US$10,000.00 (5 working days). 
• Report to the FIU any operation or transaction carried out by other means than cash, individual or multiple, regardless of whether it is considered suspicious or not, that exceeds US$25,000.00 (5 working days).
• Insurance companies must notify payments made in concept of indemnities above US$25,000.00.
• Report suspicious transactions or attempted transactions regardless of the amount (5 working days after the respective analysis, which cannot be more than 15 working days from the event).
• Establish an Internal Due Diligence Policy for identification of Clients including local and foreign PEPS.
• Establish KYC proceedings to all users who require their services.
• File and keep records of the operations for a period of 5 years.
• Train staff on the processes or techniques of anti money laundering at least ones a year.
• Establish mechanisms of Internal Audit to verify the fulfillment of the proceeding required by the Law related to AML.
• Establish policies, rules and mechanisms of conduct to be observed by its managers, workers, officers and employees consisting of:
  • Know adequately the Economic Activity of its Clients, magnitude, frequency, daily transactions, etc.
  • Establish that the volume, value and movement of its Clients' funds are related to their economic activity.
  • Report to the FIU any relevant information on fund management, whose amount or characteristics are not related to the economic activity of its Clients.
  • Maintain nominative records of its users.
  • Maintain for a period not less than 15 years the records on transactions.
  • Name a Compliance Officer in charge of the Compliance Unit by the Board of Directors.

What are the current regulations for data protection?

LAW OF THE REGULATION OF PERSONAL CREDIT HISTORY INFORMATION SERVICES, this is complemented with the CONSUMER PROTECTION LAW, BANKING LAW and the Regulations of the Financial System Superintendence.

Who is obliged to comply?

The economic agents, natural or legal persons, public or private, except for the Superintendence of the Financial System, that carry out any economic, financial, banking, commercial, industrial or service activity, that handle or have access to data on the credit history of consumers or clients, by themselves, through intermediaries or through a leased service. It shall also apply to data information agencies, legal entities, public or private, except for the Superintendence of the Financial System, which are authorized to provide the service of storage, transmission and information, by any technological or manual means, of the data on the credit history of consumers or clients.

Who regulates the data protection issue?

The Financial System Superintendence and the Consumer's Protection Agency