Unlawful refusal of the bank to conduct a financial transaction

The Bank may not refuse a client to service or conduct a financial transaction for failure to provide the client with documents and information unless the required documents are provided by law and the request is not duly executed.

The Bank sent a letter to its individual entrepreneur signed by the Deputy Managing Director.

The letter expresses its sincere gratitude for the long-term clientele of the bank and the hope for cooperation in the future, the announcement on the acquisition of the status of bank secrecy of all information received by the bank and the warning on refusal of service in accordance with Article 64 of the Law of Ukraine "On Banks and Banking Activity" at the request of the bank before (the second day after receipt - edit), in particular, for the purpose of studying and analysis of account transactions, supporting documents for (specific month - rev):

- an official letter explaining the economic feasibility of providing / receiving financial assistance;

- the financial statements as of the last reporting date;

- current documents for the operation for (specific date of the month - edit).

The client's obligation to provide documents and information on the bank's demand is provided for in part 4 of Art. 64 of the Law of Ukraine “On Banks and Banking”.

According to the provisions of this rule of law, these are not any at the discretion of the bank, but only necessary for the identification and / or verification of documents and information, as well as other documents and information required by law to establish the identification data of the final beneficial owners (controllers), analysis and identification of financial transactions subject to financial monitoring in order to comply with the requirements of the legislation governing relations in the field of preventing the legalization (laundering) of proceeds from crime, the financing of t roryzmu and the financing of proliferation of weapons of mass destruction.

Necessary for the analysis of the correspondence of the financial transaction with the content of the client's activity and its financial status information (official documents), according to part 8 of Article 64 of the Law of Ukraine "On Banks and Banking", the bank is obliged to demand from the state authorities, state registrars, banks, other legal entities, not the entrepreneur.

The list specified by the bank in the letter does not contain documents and information for identification and / or verification, and those specified as other documents and information are NOT provided by the legislation for establishing the identity of the final beneficial owners (controllers), analysis and detection of financial transactions subject to financial monitoring to meet the requirements of the legislation governing relations in the field of preventing the legalization (laundering) of proceeds of crime, the financing of terrorism and financing the proliferation of weapons of mass destruction.

Pursuant to Part 1, Article 64 of the Law of Ukraine "On Banks and Banking", banks are prohibited from entering into contractual relations (to conduct currency exchange transactions, financial transactions with banking metals, with cash (cash) with clients - legal or physical persons: in cases where there is doubt that the person does not act on his / her own behalf, who are included in the list of persons related to terrorist activities or who are subject to international sanctions; the hold.

In such other cases as defined in Article 10 of the Law of Ukraine "On Prevention and Counteraction to Legalization (Laundering) of Proceeds of Crime, Financing Terrorism and Financing the Proliferation of Weapons of Mass Destruction" are:

- an obligation to refuse a customer service (including by severing a business relationship) in the event that the fact of providing it with the identification and / or verification of the client (in-depth customer verification) of false information or misrepresentation is made by the client primary financial monitoring (Part 1).

- the right to refuse: to carry out a financial transaction if the financial transaction contains features that are subject to financial monitoring in accordance with this Law; from establishing (maintaining) a business relationship (including by breaking a business relationship) or conducting a financial transaction in the event of failure to provide the client with the documents or information necessary to examine the client or to establish unacceptably high risk based on the results of the risk assessment or reassessment. (Part 1)

- the right to refuse to carry out financial transactions (servicing) in case the client did not submit the relevant information (official documents and / or duly certified copies thereof) at the request of the subject of the initial financial monitoring to clarify the information about the client (official documents and / or duly certified copies thereof).

That is, banks are not forbidden to enter into contractual relations (to conduct currency-exchange financial transactions, financial transactions with banking metals, with cash (cash) with clients - legal or natural persons in the case of:

- there is no doubt that the person is acting on his / her own behalf, he / she is NOT included in the list of persons related to terrorist activities or subject to international sanctions;

- NOT to establish the fact of their submission during the identification and / or verification of the client (in-depth client verification) of false information or the submission of information for the purpose of misleading the subject of the initial financial monitoring;

- if the financial transaction does not contain signs that are subject to financial monitoring under this Law;

- providing the client with the documents or information necessary for the client's study or NOT establishing the client at an unacceptably high risk as a result of the risk assessment or reassessment;

- if the client, at the request of the subject of the initial financial monitoring to clarify information about the client, provided the relevant information (official documents and / or duly certified copies thereof).

In addition, according to the information of the Unified State Register of Legal Entities, Individual Entrepreneurs and Public Formations on the official website of the Ministry of Justice of Ukraine at the link (Internet address - red) by the person elected (appointed) to the body of the legal entity authorized to represent legal entity in legal relations with third parties, or persons entitled to act on behalf of the legal entity without a power of attorney, including to sign contracts and data on the presence of restrictions on representation on behalf of the legal entity (bank name - editorial board) (identification code ________, location ____________) indicated the head - (last name, patronymic - editorial).

The letter is signed by the Deputy Manager of the Branch without duly confirmed powers by the respective power of attorney to act on behalf of the bank to third parties.

In such circumstances, the letter on the requested supporting documents is NOT a demand for documents and information in the understanding of the Law of Ukraine "On Banks and Banking" therefore, does not induce the client to provide them, and in case of non-submission - can not be considered as a reason to refuse the client in servicing or conducting financial transactions.

With respect and hope for further cooperation of the FOP

Roman Truskavetsky LegalHelp