09ASTANA1508, KAZAKHSTAN: ANTI-MONEY LAUNDERING LAW SIGNED

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Reference ID Created Released Classification Origin
09ASTANA1508 2009-09-10 09:06 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO2347
PP RUEHAG RUEHAST RUEHBI RUEHCI RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK
RUEHKW RUEHLA RUEHLH RUEHLN RUEHLZ RUEHNEH RUEHNP RUEHPOD RUEHPW
RUEHROV RUEHSK RUEHSL RUEHSR RUEHVK RUEHYG
DE RUEHTA #1508/01 2530906
ZNR UUUUU ZZH
P 100906Z SEP 09
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 6199
INFO RUCNCIS/CIS COLLECTIVE 1915
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1285
RUEHKO/AMEMBASSY TOKYO 1983
RUEHUL/AMEMBASSY SEOUL 0942
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1472
RUEKJCS/SECDEF WASHDC 1357
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHAST/USOFFICE ALMATY 1856
RUEAWJL/DEPT OF JUSTICE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUEANQT/FINCEN VIENNA VA
RHMCSUU/FBI WASHINGTON DC
RUEABND/DEA HQS WASHINGTON DC
RHMFIUU/DEPT OF HOMELAND SECURITY WASHINGTON DC 0030

UNCLAS SECTION 01 OF 02 ASTANA 001508 
 
SENSITIVE 
SIPDIS 
 
STATE FOR INL/AAE, INL/C, SCA/CEN 
 
E.O. 12958: N/A 
TAGS: PGOV SNAR KCRM KZ
SUBJECT:  KAZAKHSTAN:  ANTI-MONEY LAUNDERING LAW SIGNED 
 
ASTANA 00001508  001.2 OF 002 
 
 
REFTEL:  08 ASTANA 2119 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (U) SUMMARY:  On August 28, President Nazarbayev signed the 
long-awaited law on anti-money laundering (AML), which will enter 
into force in March 2010.  The law should increase the effectiveness 
of measures aimed at combating money laundering and terrorist 
financing by creating the Financial Monitoring Committee, 
Kazakhstan's Financial Intelligence Unit (FIU).  The law will also 
regulate financial monitoring, terrorist financing, and 
law-enforcement activities.  END SUMMARY. 
 
AML LAW SIGNED 
 
2.  (U) On August 28, President Nazarbayev signed the 
much-anticipated anti-money laundering law, which will come into 
force six months after publication, i.e. in March 2010.  The law 
describes preventive measures the government will undertake to 
combat money laundering and terrorism financing, and establishes the 
Financial Monitoring Committee, Kazakhstan's Financial Intelligence 
Unit (FIU), which will become operational in March 2010. 
 
NEW FINANCIAL MONITORING REQUIREMENTS 
 
3.  (U) According to the law, a wide range of organizations will be 
subject to financial monitoring, including but not limited to 
banking organizations, pension funds, insurance companies, law 
firms, independent legal experts, notary companies, audit firms, and 
postal services providers.  The law requires these organizations to 
develop internal control systems to prevent money laundering and 
terrorism financing, and to report suspicious transactions.  Banks 
are generally well prepared for the new AML law due to existing 
internal compliance and due diligence procedures. 
 
A NEW LAW ENFORCEMENT ASSET 
 
4.  (U) One of the most significant aspects of the new law is the 
establishment of the Financial Monitoring Committee.  This new 
institution is expected to enhance the ability of law enforcement to 
investigate financial crimes and prevent terrorist financing.  Once 
the law comes into effect in March 2010, all law enforcement 
agencies in Kazakhstan will be able to search the new FIU's 
extensive database. 
 
A LONG TIME COMING 
 
5.  (U) It took more than four years for the lower chamber of 
parliament (the Majilis) to approve the draft AML law and send it to 
the Senate.  During that time, the law was subjected to numerous 
revisions, as comments from various lawmakers and external advisors, 
including the World Bank, were taken into account.  In April 2008, a 
Committee for Financial Monitoring was established, and former 
Senator Mussiraly Utebayev was named chairman in October 2008 
[reftel].  Until that time, very little progress on the draft law 
was made.  The law was finally approved by the Senate on June 17, 
but was signed by the President only after the Constitutional 
Council determined that it was in compliance with the Constitution. 
 
FIU PLANS 
 
6.  (SBU) On September 4, Utebayev told INL Officer that his 
committee must meet an ambitious schedule if the FIU is to be 
operational when the law enters into force.  In particular, he said 
his committee is working to develop an effective information system, 
define the scope of financial monitoring activities, adopt bylaws 
and regulations to implement the law, and train personnel. 
 
7. (SBU) COMMENT:  In the year since Utebayev became chairman of the 
Kazakhstani FIU, he has proven himself an effective and far-sighted 
 
ASTANA 00001508  002.2 OF 002 
 
 
leader, capable of developing an operational, sufficiently-funded 
FIU. His authority and personal connections with President 
Nazerbayev ensured the final passage of the AML law.  He asserts 
that his study tour to the United States also played a vital rule in 
the adoption of the law and significant progress on the FIU 
information system.  Implementation will be the next test and will 
require continued U.S. engagement.  But, establishment of the new 
FIU will offer the government a powerful new tool for preventing 
crimes whose effects can extend well beyond the borders of 
Kazakhstan and providing solid evidence when prosecutions are 
appropriate.  END COMMENT. 
 
HOAGLAND

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