Investigation and reporting requirements

Obliged entities, their employees and managers shall notify the Financial Intelligence Unit (hereinafter FIU) in a timely manner of suspicious transactions and funds that are suspected of being traceable to criminal conduct. The term suspicion refers to the lowest level of suspicion and does not therefore constitute as detailed and unequivocal a claim as generally applies in legal proceedings for a substantiated suspicion, but in this case refers to a sufficient suspicion. In accordance with international rules in the field of measures against money laundering and terrorist financing, it is considered better for obliged entities to report more often than not. The FIU is responsible for processing the matter further and analysing the information attached to the notification.

Obliged entities must fulfil their investigative duties and carry out some preliminary investigation and analysis. Business must be avoided when there is knowledge or suspicion that it can be traced to criminal conduct.

The duty of obliged entities to investigate may be triggered when, for example:

  • transactions, transfers of funds or the administration of other forms of assets or funds do not appear to have any economic or legitimate purpose,
  • in the case of unusually high or complex transactions,
  • the transactions seem unusual compared to previous transactions of the party concerned.
  • in the case of transactions involving parties in high-risk countries or
  • transactions that otherwise seem to be of an unusual nature.

Notifications must be sent to the FIU through the goAML System and their content must be clear so that there is no doubt about which individual or specific transaction or transfer is being reported and why it is suspected to be related to criminal conduct.

Obliged entities shall send notifications to the competent authority of the state in which the obliged entity is established, i.e. where it has an operating licence and its headquarters. Accordingly, obliged entities established in Iceland shall send their notifications to the Icelandic FIU.

Obliged entities are obliged to appoint an AML/CFT compliance officer from their management to the FIU and the Central Bank of Iceland, and he/she shall normally handle notifications to the FIU. He/she must have unconditional access to the customer due diligence, transactions or requested transactions, as well as all the data that may be relevant to the notifications.

Useful links

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Business wide risk assessment Policies, controls and procedures Employee training Customer due diligence Risk assessment of contractual obligations and occasional transactions On-going monitoring Investigation and reporting requirements

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