Lenders in Cyprus ‘challenging’ money laundering associations

NICOSIA, Cyprus, Dec 25, (AP): Banks in Cyprus are concerned that their adoption of some of the toughest anti-money laundering regulations in the world has not been fully recognized abroad, the chief of the Association of Cyprus Banks said Monday.

Association Director Michalis Kammas said that banks are challenging “outdated perceptions” and are working to raise awareness about reform efforts.

Kammas says more rigorous supervision and directives have led to the closure of a “significant number” of bank accounts since 2014.

“Today, Cypriot banks’ procedures encompass some of the most advanced banking compliance practices globally,” Kammas told the Associated Press in an e-mail. Kammas said international supervisory bodies like the Organization for Economic Co-operation and Development and Transparency International have recognized Cyprus’ strong efforts but that the message hadn’t gotten through to some stakeholders, including the media.

Prior to a 2013 banking sector crisis that brought Cyprus to the brink of bankruptcy, the east Mediterranean island nation, which is an EU member, was hounded by allegations that it was a tax and money laundering haven.

Kammas said the crisis hit home with Cypriot authorities that they had to clean up the banking system and that pressure to do so had come “as much from political commitment within as it has from outside authorities.” He said Cyprus is working closely with foreign supervisory authorities from the EU and the US to ensure that financial sector legislation is fully in line with international best practices.