Financial monitoring of payment card transactions

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Financial monitoring of payment card transactions

Vnukova Nataliya

Doctor of Economics (2nd PhD)

Leading researcher of Scientific and Research Institute

of Providing Legal Framework for the Innovative

Development of NALS of Ukraine

Professor of the Department of Customs and

Financial Services

Simon Kuznets Kharkiv National University of Economics



Abstract

The relevance of determining the impact of international standards on the development of financial investigations is determined by the need to build an effective financial monitoring system and improve the effectiveness of coordination of the activities of financial monitoring entities, in particular, at the state level.

The aim of the study is to develop theoretical provisions and practical skills to determine the essence of financial monitoring and development of the direction of financial investigations to counter money-laundering and the financing of terrorism.

It has been established that cash is widespread in criminal money laundering schemes. In the context of a sufficiently large amount of cash in the economy, which is used on a scale taking into account the nature and specifics of their activities, identifying and combatting money-laundering of criminal proceeds using cash is a difficult task.

Given the constant introduction of legislative restrictions and increased control of the financial system by public authorities, intruders are developing new or improving existing money laundering schemes, aiming to give illegal financial transactions the most legal appearance.

At the same time, both at the level of public authorities and at the level of primary financial monitoring entities, new methods and approaches to identifying money laundering schemes are constantly being introduced and improved.

The organization of financial investigations has become more important since the introduction of international FATF standards.

Key words: The State Financial Monitoring Service, «dirty» money, money laundering, Financial Action Task Force, cash.



Внукова Наталія Миколаївна, доктор економічних наук, професор, провідний науковий співробітник НДІ правового забезпечення інноваційного розвитку НАПрН України, професор Харківського національного економічного університету імені Семена Кузнеця

Аванесян В'ячеслав Андрійович, Магістр Харківського національного економічного університету імені Семена Кузнеця

Фінансовий моніторинг операцій з платіжними картками

Анотація

control financial transaction economic

Постановка проблеми. У сучасних міжнародних фінансово-економічних умовах, що характеризуються нестабільністю макроекономічної ситуації, високим ступенем невизначеності та ризику, значення інструментів фінансового моніторингу значно зростає. Антилегалізаційні напрямки господарської діяльності різних суб'єктів є тенденцією розвитку економіки, а не тільки фінансових ринків. Фінансовий моніторинг близький до поняття фінансового контролю, а також безпосередньо пов'язаний з фінансовими розслідуваннями фінансових операцій. Ці питання останнім часом активно досліджуються, тому вплинули на вибір теми дослідження.

Мета статті. Метою статті є розгляд нових вимог європейського законодавства щодо боротьби з відмиванням грошей щодо рівня контролю фінансових операцій, зокрема, з платіжними картками.

Аналіз останніх досліджень і публікацій. Проблеми та перспективи розвитку національної системи фінансового моніторингу в Україні відображені в працях багатьох науковців, зокрема С.А. Дмитрова, Н.Я. Дондика, О.І. Жабинець, А.В. Єжова, В.В. Коваленко, І.В. Коломієць, Г.М. Крип, Н. В. Москаленко, С.А. Синянського та ін.

Виклад основного матеріалу. Встановлено, що готівка широко поширена в злочинних схемах відмивання грошей. В умовах достатньо великого обсягу готівки в економіці, яка використовується в масштабах з урахуванням характеру та специфіки їх діяльності, виявлення та протидія відмиванню злочинних доходів з використанням готівки є складним завданням.

Основу законодавчої бази у сфері запобігання та протидії легалізації (відмиванню) доходів, одержаних злочинним шляхом, та фінансуванню тероризму складають: міжнародні стандарти FATF, Закон України «Про запобігання та протидію легалізації (відмиванню) доходів від злочинності, фінансування тероризму та фінансування розповсюдження зброї масового знищення» та інші нормативно-правові акти державних суб'єктів первинного фінансового моніторингу.

Аналіз нових вимог законодавства підтверджує, що розвиток нормативно-правової бази передбачає низку новацій у роботі системи фінансового моніторингу як внутрішнього, так і міжнародного протидії відмиванню «брудних» грошей.

Що стосується розвитку фінансових розслідувань, то нове законодавство надає можливості для більш детального визначення дій щодо аналізу можливих процедур легалізації (відмивання) доходів, а отже, розвитку технологій фінансових розслідувань.

Запровадження та подальший розвиток національної оцінки ризиків системи фінансового моніторингу, яка передбачає систему заходів, що здійснюються суб'єктами державного фінансового моніторингу (уповноваженими органами державної влади) із залученням інших суб'єктів фінансового моніторингу (за потреби) з метою визначення (виявлення) ризиків (загроз) легалізації (відмивання) доходів, одержаних злочинним шляхом, дає вагоме підґрунтя для організації та проведення подальших фінансових розслідувань.

Застосування ризик-орієнтованого підходу до процедур фінансового моніторингу має посилити відповідальність осіб за протидію можливому відмиванню коштів як фізичними особами, так і суб'єктами господарювання.

Удосконалення законодавчих аспектів впливає на якість розслідування злочинів з легалізації (відмивання) доходів, одержаних злочинним шляхом, зокрема щодо підслідності злочинів з легалізації, посилення фінансового контролю за діяльністю публічних осіб, удосконалення процедур зупинення фінансових операцій.

Суттєві зміни щодо запобігання легалізації доходів стосуються визначення та зниження порогових значень для операцій з готівкою та міжнародних переказів, а також функцій суб'єктів первинного фінансового моніторингу, на яких покладено обов'язки не лише ідентифікації суб'єктів, а й перевірки та перевірки додано кінцевого бенефіціарного власника.

Висновки. Враховуючи постійне запровадження законодавчих обмежень та посилення контролю за фінансовою системою з боку державних органів, зловмисники розробляють нові або вдосконалюють існуючі схеми відмивання грошей, прагнучи надати незаконним фінансовим операціям максимально законного вигляду. При цьому як на рівні органів державної влади, так і на рівні суб'єктів первинного фінансового моніторингу постійно впроваджуються та вдосконалюються нові методи та підходи до виявлення схем легалізації злочинних доходів.

Ключові слова: Держфінмоніторинг, «брудні» гроші, відмивання грошей, група фінансових заходів протидії, грошові кошти.



Problem setting

The relevance of determining the impact of international standards on the development of financial investigations is determined by the need to build an effective financial monitoring system and improve the effectiveness of coordination of the activities of financial monitoring entities, in particular, at the state level.

The object of the research is the economic relations that arise between financial institutions, subjects of state and primary financial monitoring, initiators of financial transactions and recipients of funds in the processes of prevention and countermeasures against the legalization of proceeds obtained through crime.

The subject of the study is the potential for the formation of professional and personal competencies in the field of financial monitoring and the skills of subjects of primary financial monitoring in relation to payment cards.

The research assumes the need to solve the following tasks:

Consider the regulatory and legal support of financial monitoring in Ukraine in the context, in particular, of the implementation of FATF international standards;

Decide on actions to reduce the risks of money laundering and terrorist financing;

Analyze methods and mechanisms of money laundering and terrorist financing;

Determine the risks of using financial institutions to launder proceeds obtained through crime, which must be taken into account when conducting operations with payment cards.

Analysis of resent researches and publications

Problems and prospects for the development of the national financial monitoring system in Ukraine are reflected in the works of many scientists, in particular, S.A. Dmitrova [1], N.Ya. Dondika [2], O.I. Zhabynets [3], A.V. Ezhova [3], V.V Kovalenko [4], I.V. Kolomiets [5], G.M. Krip [6], N.V. Moskalenko [7], S.A. Sinyansky [8] etc.

The basis of the legislative framework in the field of preventing and combating the legalization of proceeds of crime or the financing of terrorism are: FATF International Standards [9], the Law of Ukraine «On Prevention and Counteraction to the Legalization (Laundering) of Proceeds from Crime, Financing of Terrorism and Financing of Proliferation of Weapons of Mass Destruction» [10] and other regulations of state entities of primary financial monitoring.

In modern international financial and economic conditions, characterized by instability of the macroeconomic situation, a high degree of uncertainty and risk, the importance of financial monitoring tools increases significantly. Antilegalization directions of management activities of different subjects are a trend in the development of the economy, not just financial markets.

Financial monitoring is close to the concept of financial control, and is also directly related to financial investigations for financial transactions.

These issues have been actively investigated recently, so they have influenced the choice of the topic of research.

The modern importance of the financial intelligence unit in Ukraine.

The State Financial Monitoring Service of Ukraine is the central executive body authorized to implement state policy in the field of combating money laundering and terrorist financing, whose activities are directed and coordinated by the Cabinet of Ministers of Ukraine.

In accordance with the tasks set, The State Financial Monitoring Service of Ukraine collects, processes and analyses information on financial transactions subject to financial monitoring and other operations related to income laundering [11, 12].

The State Financial Monitoring Service of Ukraine has extensive international cooperation with financial intelligence units of other countries, providing opportunities for the development of financial investigations, during which mutual exchange of information was carried out.

Meanwhile, the State Financial Monitoring Service was established as a financial intelligence unit - a new type of state body designed to counter money laundering and the financing of terrorism, and it does not have a «full cycle» of financial investigation processes to identify the facts of money laundering, but carries out a significant pre-trial part of the stages of countering laundering.

The financial monitoring system consists of two levels - primary and state. The subject of primary financial monitoring must [10]:

To identify, verify the person carrying out a financial transaction subject to financial monitoring;

To ensure the detection and registration of financial transactions that are subject to financial monitoring in accordance with the law;

To provide the Authorized Body (The State Financial Monitoring Service ofUkraine) with information on the financial transaction subject to financial monitoring;

To assist employees of the Authorized Body in the analysis of financial transactions subject to mandatory financial monitoring;

Provide, according to the legislation, additional information at the request of the Authorized Body related to financial transactions that have become the object of financial monitoring, including constituting bank and commercial secrets upon request;

Assist the subjects of state financial monitoring in the analysis of financial transactions subject to financial monitoring, and therefore, the implementation of procedures for preventing and countering money laundering and terrorist financing.

The target of the research. Consideration of the new requirements of the European anti-money laundering legislation regarding the level of control over financial transactions, in particular, with payment cards.



Articles main body

Modern legislation of Ukraine is aimed at ensuring the implementation of the provisions of international standards in the field of countering money laundering and combating the financing of terrorism [9], which was adopted takinginto account the proposals to the national legislation of experts of the Group on the Development of Financial Measures to Combat Money Laundering and the Financing of Terrorism (FATF).

Analysis of new legal requirements confirms that the development of the regulatory framework provides for a number of innovations in the work of the financial monitoring system, both domestic and international counteraction to laundering of “dirty” money.

With regard to the development of financial investigations, the new legislation provides opportunities for a more detailed definition of actions to analyse possible procedures for legalization (laundering) of income, and therefore the development of financial investigation technologies.

Introduction and further development of the national risk assessment of the financial monitoring system, which provides for a system of measures carried out by subjects of state financial monitoring (authorized bodies of state power) with the involvement of other subjects of financial monitoring (if necessary) in order to determine (detection) the risks (threats) of legalization (laundering) of proceeds from crime, provides a significant basis for the organization and conduct of further financial investigations.

The application of a risk-based approach to financial monitoring procedures should strengthen the responsibility of persons to counter potential money laundering by both individuals and business entities.

Improved legislative aspects affect the quality of investigation of crimes on the legalization (laundering) of proceeds of crime, in particular on the jurisdiction of legalization crimes, strengthening of financial control over the activities ofpublic figures, improvement of procedures for suspending financial transactions. Procedure for preventing and countering money laundering.

Significant changes to prevent income legalization are related to the definition and reduction of thresholds for cash transactions and international transfers, as well as the functions of primary financial monitoring entities, to whichthe obligations not only to identify entities, but also to verify and verify the ultimate beneficial owner have been added.

Analysis of resent researches and publications shows that 1991adopted the first version of the FATF's Forty Recommendations on an internationalprogram to combat the use of the financial system for money laundering.

Then they were revised several times, and in 2012 they already turned into international standards with 40 positions.

Forty recommendations of international standards [13] are the basis of provisions on combating money laundering, they are constantly being improvedand intended for application by all countries. The FATF international recommendations allow States to show some flexibility in their implementation, taking into account the peculiarities of the national legal system, in particular, this applies to Ukraine.

But there are countries that slowly or do not introduce these international standards at all, so according to FATF decisions on their scale they are in certain spears regarding the level of compliance.

Despite its legally optional nature, FATF international standards have had asignificant impact on the development of international cooperation and the formation of the foundations of national anti-legalization systems both in FATF member states and in many other countries.

The system of self-assessments and mutual assessments played an important role in the dissemination and effective implementation of international standards.

The revision of international standards takes into account the experience of countries, as well as changes in the methods and methods of laundering funds studied during financial investigations and countering relevant crimes.

FATF international standards cover the following main sections [14]:

Criminal prosecution of persons related to money laundering, including interim measures and confiscation of criminal proceeds;

Measures taken by financial institutions to prevent money laundering;

Institutional activities, including the establishment of financial intelligence units, as well as legal and material support for the activities of law enforcement and supervisory authorities.

International cooperation in the field of countering money laundering, including in the exchange of information between the competent authorities. The key is the first standard - the introduction of a risk-based approach in the anti-legalization sphere.

The main element in combating money-laundering and the financing of terrorism is to ensure that the systems of ongoing countries are monitored for their compliance with the requirements of international standards.

Table 1 presents the structure of international FATF standards [13, 15].

Table 1. Structural components of international standards

Legal systems	International cooperation
Content of the criminal offense ofmoney laundering	Mutual legal assistance
Preventive measures	Extradition
Confiscation	Other forms of international cooperation
FATF international standards
Measures of subjects of primary financial monitoring to prevent money laundering and terrorist financing	Institutional measures of anti- legalization direction and fight against terrorism
Customer due diligence rules	Development of competent bodies,their powers and resources
Information storage requirements	Transparency of legal entities
Notification of suspicious transactions	Determination of ultimate beneficial owners

Ukraine is constantly under the attention of international organizations on this issue, in particular the Council of Europe. Mutual assessment of the level of development of financial measures to combat moneylaundering is a necessary mechanism to ensure the effective implementation of FATF international recommendations by all countries.

As can be seen from Table 1, there are certain prerequisites for the implementation of international standards and measures to implement them directly.

To implement another 40 FATF recommendations in 1995, an informal association of national agencies performing financial intelligence functions was established, which was called the Group of Financial Intelligence Units «Egmont», an international organization uniting professional practitioners for the developmentof international cooperation in the field of anti-legalization struggle [16].

The creation of anti-legalization legislation is a matter of national security. Laundering of proceeds of crime is not only a socially dangerous act, but also a systemic threat to financial markets and the national economy as a whole [17].

The primary financial monitoring entity must identify the person carrying out financial transactions. on the basis of the originals provided or duly certified copies of documents.

Table 2 provides a list of documents necessary to identify persons performing monetary transactions, in particular with payment cards [16].

Table 2. List of documents for identification of persons for financial transactions

Identification byresidence status	Person's status
	Individuals	Entities
Resident	Last name, first name, date of birth, series and number of passport (or other identity document), date of issue and thebody that issued it, place of residence, identification numberaccording to the State Registerof natural persons - taxpayers and other mandatory payments	Name, legal address, documentsconfirming state registration (including founding documents, information on officials and their powers, etc.), identification code according to the Unified State Register of Enterprises and Organizations of Ukraine, detailsof the bank in which the account is opened, and the bank account number
Non-resident	Surname, first name, patronymic (if any), date ofbirth, series and number of passport (or other identity document), date of issue and issuing authority, citizenship, place of residence or temporary stay	The full name, location anddetails of the bank where the account isopened, and the bank account number. The subject of primary financial monitoring is also provided with a copyof a legalized extract from the trade,bank or court register or a notarizedregistration certificate of the authorizedbody of a foreign state on the registration of the relevant legal entity

As can be seen from Table 2, the list of identification features is wide.

If there is a representative of a person in need of identification, the subject of primary financial monitoring is also obliged to identify the person on whose behalf the financial transaction is carried out or is the beneficiary.

Before or after the financial transaction, the primary financial monitoring entity finds out the possibility of classification as a financial transaction subject to financial monitoring. When identifying and studying the client's financial activities, the most common phenomenon is to interview the client through the preparation of a questionnaire. According to the general rules, the questionnaire (or questionnaire) is an internal document of the subject, which is filled in and signed by an employee authorized to carry out identification [18].

The questionnaire can be formed several times: based on the results of identification and study of the client's financial activities before, during and in the process of customer service. The questionnaire (quiser) must contain all the necessary information, in particular regarding the notification of the financial transaction submitted to the State Financial Monitoring Committee, in cases established by law.

The subject of primary financial monitoring on the basis of a survey conducted during identification has the right to refuse to carry out a financial transaction. This can happen when signs of a suspicious nature and subject to financial monitoring are identified.

As part of the survey, the primary financial monitoring entity is obliged to carry out risk management taking into account the results of identification, verification and study of the client and financial services provided to the client, analysis of operations carried out by him and their compliance with the financial condition and content of activities.

Assessment of clients' risks by the subject of primary financial monitoring is carried out according to the relevant criteria, in particular by the type of client, the geographical location of the state of registration of the client or the institution through which he transfers (receipt) assets, and the type of goods, services that the client receives from the subject of primary financial monitoring [19].

Based on the analysis of the Criteria for the risk of legalization (laundering) of proceeds of crime or financing of terrorism [20] the client's risk profile is determined.

For a more detailed analysis, it is necessary to find out all the related facts and circumstances. To this end, it is necessary to consider the ways of organizing and stages of the «dirty money» laundering process.

The procedure of money laundering is carefully developed by the participants in crimes, for a more intricate technology it consists of many stages, and each of them can have its own characteristics and distinctive features.

The most common model of the money laundering process is presented by the international organization FATF (Financial Action Task Force). According to it, the legalization process can be divided into three stages (stages): placement, stratification (camouflage) and integration.

Determining the potential risk of laundering criminal proceeds towards the client is an essential part of the financial monitoring system. Each financial institution, in particular the bank, on the basis of its internal criteria, must assess the client to create his risk profile. This process takes place at the stage of its identification through a questionnaire.

In accordance with Article 23 of the Law of Ukraine «On Payment Services» [21, 22], payment service providers, in particular, banks that are subjects of primary financial monitoring (SPFM), are obliged to carry out measures of proper verification of the client in accordance with the requirements of legislation in the field of prevention and combating the legalization (laundering) of proceeds of crime, financing of terrorism and financing of the proliferation of weapons of mass destruction.

The result of the general assessment of the client's SPFM risk according to certain criteria on the basis of signs of risk is the establishment of the level of risk.

Banks start the risk assessment process with a questionnaire when establishing a business relationship with the client.

The main regulatory documents for the prevention of money laundering obtained by criminal means, on the basis of which internal regulatory documents and policies JSC have been developed, are the special legislation of Ukraine, the Regulation on the implementation of financial monitoring by institutions [23]; Recommendations of the Financial Action Task Force on Money Laundering (FATF); Wolfsberg Group Standards.

Domestic rules, procedures and policies are updated in accordance with national legislation and best examples of international practice. When conducting transactions with payment cards, all data entered in the questionnaire has the status of bank secrecy and cannot be used or distributed without the knowledge and consent of the client, except in cases provided for by the legislation of Ukraine. It includes personal data: Social status: Address and Contacts: Information about the identification document: It is possible to use a trustee, his personal and identification data is also indicated. Conducting professional activities, belonging to politically significant persons, their family members or related persons. The purpose and nature of future business relations with the bank are determined: Sources and volume of receipt of funds and other valuables to accounts Information on the financial condition on the scale. Information on belonging to U.S. tax residents (In order to comply with the requirements of the United States of America Foreign Account Tax Requirements Act). The questionnaire is signed by hand.

The risk-based approach does not change or mitigate the requirements of current legislation in the field of preventing and combating the legalization (laundering) of proceeds of crime and the financing of terrorism, but is aimed at identifying those who are trying to legalize criminal proceeds or finance terrorism through SPFM and prevent their activities.

Placement is the initial stage of money laundering, during which cash is physically placed in financial institutions (banks, credit unions, pension funds) through non-financial sector institutions (bars, restaurants, hotels, antique and jewelry stores), as well as in institutions related to the entertainment industry, automotive business and retail trade. Consequently, in the process of placement, illegal income turns into liquid assets, and this is where they are the easiest to identify.

The second stage. Stratification or disguise is a rupture of illegal income and its sources due to the use of financial transactions aimed at transforming these income. Through the third stage - integration, it is the legalization of income.

Some operations are considered as an example of financial investigations.

There are features of transactions with securities that can be used for money laundering [24].

Such legalization mechanisms may involve employees of a financial institution who provide inaccurate information to obtain a loan, so the bank's financial monitoring service should carefully check such operations, strengthen the compliance service [25].

Separately, there are some special schemes of «laundering» of funds at the international level, for example, «hawala» (this is money laundering in the «golden triangle» (Thailand, Burma, Laos) [26].

The State Financial Monitoring Service of Ukraine actively cooperates with leading international organizations and institutions involved in or contributing to financial investigations; FATF, regional organizations such as FATF - Council of Europe Committee of Experts on the Assessment of Measures to Counter Money Laundering and Financing of Terrorism, which constantly monitors the implementation of international standards in Ukraine, the Egmont Group of World Financial Intelligence Units, the Organization for Security and Cooperation in Europe (OS) and others [27].

The development of international trade between countries, including in Ukraine, plays an important role in the economic development of countries and is a powerful factor in economic growth, while there may be risks of money laundering [28]. They cover a significant part of total international trade, as it is difficult to exchange customs information between countries; there are difficulties associated with the exchange of foreign currency necessary for international trade.

Traditional forms of criminal activity can be sources of illegal income that are legalized through foreign economic transactions, as well as income from misuse of state budget funds and state borrowings [28]. Part of the exported shadow capital may later be returned to the country in the form of foreign investments aimed at supporting and expanding the legal income-generating business. A significant part of such operations are carried out through offshore zones.

A wide range of such operations are export-import operations [29], in particular, the transfer of funds abroad on the basis of fictitious import contracts, export at low prices, export of products unusual for the main activity of the enterprise under commission contracts («atypical» export), etc.

These schemes most often involve «shell companies», both domestic legal entities and nonresident companies, whose activities are controlled by citizens of Ukraine, and foreigners whose registration is carried out in order to create only the appearance of financial and economic activities [29].

A common mechanism is to conduct export operations at inflated prices using imitation of the production of exported goods [29].

Wide risks are the use of actions to launder criminal proceeds. A significant number of technical shares are being traded on the securities market of Ukraine. They have no value, as they are mainly issued by bankrupt enterprises. Due to the discrepancy in the cost of purchase and sale, stakeholders optimize taxation or manipulate the amount of capital [30].

In Ukraine, two-thirds of the shares of enterprises established in the process of privatization can be considered «technical», while in world practice they consider such shares with no system of securing the issuer's obligations and ultra-high risks.

Changes in the legislation on the existence of shares exclusively in non- documentary form reduced the risk of using them to manipulate capital outflows, but left the possibility of circulation of issuers' shares with signs of fictitiousness. Meanwhile, the National Securities and Stock Market Commission [31] should strengthen control over such shares from the point of view of financial monitoring.

As for the typologies related to money laundering, which should be taken into account by primary financial monitoring entities, the State Financial Monitoring Committee gives another example of securities transactions.

The investigation technique is given in the order of the State Financial Monitoring Committee of December 20, 2007 No. 230 on the Typology of Legalization (Laundering) of Income Received as a Result of Financial Transactions with Illiquid Securities [32].

The technique of investigating money laundering in the securities market is similar to conducting investigations in other areas. But at the same time, the investigation of money laundering in this area requires special methods due to existing specific features, such as: - a significant number of transactions and financial transactions with securities can be concluded very quickly and in a short period of time (or for a large amount); - there is a high probability of “mixing” of clean and dirty funds; - insider operations/manipulation of the securities market and predicate sin are closely connected together. Among the main stages of the investigation are the following: I. obtaining primary («raw») data; II. Suspicion, decision-making to conduct an investigation; III. Analyses: 3.1. Building schemes of operations, establishing a circle of participants; 3.2. collection of additional information; 3.3. Identification of discrepancies. IV Preparation of materials confirming suspicions.

Transactions related to the provision of funds under the guise of a loan or repayable financial assistance acquire fairly broad practice, thus creating the appearance of fully legal and ordinary commercial transactions, and thus giving the appearance of legality the sources of funds derived from daily business activities.

The term of agreements on the provision of commercial loans or financial assistance has no time limits, by the time the date of repayment of the debtor's obligations will no longer exist, as the debt holder itself.

Specially authorized body, authorized bodies of state power with the involvement of other subjects (if necessary) take part in the national risk assessment of financial monitoring in accordance with the Law of Ukraine «On Prevention and Combatting the Legalization (Laundering) of Proceeds from Crime, Financing of Terrorism and Financing of Proliferation of Weapons of Mass Destruction» [10], The national risk assessment is carried out systematically, but at least every three years. Specially authorized body responsible for conducting national risk assessment.

The national risk assessment is carried out taking into account, inter alia, the requirements of the recommendations and documents of the Financial Action Task Force on Money Laundering (FATF), the provisions of reports and recommendations on assessing the risks of money laundering or financing of terrorism by the European Commission, other international analytical reviews, reports and recommendations on issues related to the national risk assessment.

Collection, processing and analysis of information on the results of the activities of financial monitoring entities, other state bodies involved in the work of the system of prevention and counteraction, approval and publication of the results of the national risk assessment and implementation of measures based on its results are carried out in accordance with the procedure established by the Cabinet of Ministers of Ukraine together with the National Bank of Ukraine.

Sources of information necessary for the national risk assessment are, inter alia, comprehensive administrative reporting in the field of prevention and counteraction, analytical reviews and certificates of participants in the national risk assessment, responses of participants in the national risk assessment to the questionnaires of a specially authorized body, Results of selective analysis of court decisions in criminal cases, results of scientific research, results of public opinion research, as well as reports of the European Commission on the identification, analysis and assessment of risks of legalisation (laundering) of proceeds of crime and/or financing of terrorism at the level of the European Union and recommendations of the European Commission on measures acceptable to eliminate certain risks.

Powers of state bodies to ensure international cooperation in the field of prevention and counteraction and the procedure for their implementation.

Two National Risk Assessments have been conducted in Ukraine, and the third report on the National Risk Assessment in the field of financial monitoring will be completed in 2022.

A specially authorised body, subjects of state financial monitoring, other public authorities and law enforcement agencies prioritise international cooperation taking into account the results of the national risk assessment.



Conclusions

The topic of financial monitoring is extremely relevant, in particular, during martial law. When researching, it is important to focus on financial transactions, in particular, with bank payment cards and cash transactions. For consumers of financial services, it is necessary to form the necessary competences regarding the prevention and countermeasures against the legalization of income obtained through criminal means.

It has been established that cash is widespread in criminal money laundering schemes. In the context of a sufficiently large amount of cash in the economy, which is used on a scale taking into account the nature and specifics of their activities, identifying and combatting money-laundering of criminal proceeds using cash is a difficult task.

Given the constant introduction of legislative restrictions and increased control of the financial system by public authorities, intruders are developing new or improving existing money laundering schemes, aiming to give illegal financial transactions the legal appearance.

At the same time, both at the level of public authorities and at the level of primary financial monitoring entities, new methods and approaches to identifying money laundering schemes are constantly being introduced and improved.

The organization of financial investigations has become more important since the introduction of international FATF standards.

The ability to solve complex tasks and problems in the field of professional activity in financial investigations and in the process of training in financial monitoring is formed through the expansion of awareness of international standards in financial monitoring.



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