The Government presented the Economic Intelligence against Crime bill last Thursday. The bill aims to strengthen the prosecution of illicit money, an initiative that is part of the executive legislative security agenda.
The Economic Intelligence against Crime bill seeks to trace the movement of money from asset laundering, the financing of terrorism and other offences linked to organized crime with different investigation and intelligence tools. It also aims to lift banking secrecy under special rules, expand the items that are required to be reported, and make inter-institutional work more robust.
“To control the money is also to control corruption; it is also to control the way in which these types of gangs – due to the great economic power they have – manage to get into decision-making networks, corrupting them and lowering the State’s capacity to react,” Carolina Tohá, Interior Minister.
The initiative to prosecute illicit money is based on three main areas:
- Strengthening of the economic intelligence ecosystem
- Prevention and early detection of suspicious economic operations
- Greater powers of intrusion and sanctioning
We invite you to continue reading to learn three key pieces of information about the bill to pursue the route of illicit money.
Strengthening of the economic intelligence ecosystem
The economic intelligence ecosystem refers to a set of interrelated agencies, institutions and systems that work together to collect, analyze and use information related to economic and financial activities, in order to prevent and combat financial and economic crimes, such as money laundering, corruption, fraud and the financing of terrorism.
The Economic Intelligence bill aims to strengthen the ecosystem through the creation of intelligence and coordination units on organized crime within the Treasury Ministry.
To strengthen the State Intelligence System in its civil dimension, the bill proposes to create intelligence units within the National Customs Service (SNA) and the Internal Revenue Service (SII).
It also regulates the coordination of the aforementioned agencies with the Financial Analysis Unit (UAF) and the State Intelligence System.
These units will be responsible for collecting and analyzing information on the competence of each service, in order to identify patterns and relationships and generate alerts for the early detection of conduct that constitutes organized crime.
How will the goals of the intelligence units be met?
In order to meet their goals, the intelligence units may collect information and background information within the respective service, and may also request information from other public bodies within the scope of their powers.
If the information required by the intelligence units is subject to any type of secrecy or reserve, it will be released according to special rules to provide timely information to identify relevant findings and perform data analysis to reveal criminal behavior.
In order to safeguard operations, the officials that make up the unit will be subject to the strictest secrecy and confidentiality regarding the information that they become aware of in the exercise of their functions, which will be adhered to following the end of their employment.
Modification of the Law of General Bases of the Bodies of the State Administration
A modification of the Law of General Bases of the Bodies of the State Administration is also proposed as part of the Economic Intelligence against Crime bill.
This modification of the Law of General Bases of the Bodies of the State Administration aims to expressly empower these bodies to exchange information so that it can be made available online in an updated, timely, expeditious manner.
Measures will also be included to support the exchange of information and standardize criteria regarding the crimes of money laundering and the financing of terrorism within public institutions, through instructions from the UAF.
Prevention and early detection of suspicious economic operations
The prevention and early detection of suspicious economic operations is an area of the Economic Intelligence against Crime bill that seeks to establish stricter requirements to develop some economic activities.
The bill will include an update of the requirements applicable to those who exercise control of banks, financial institutions and other entities overseen by the Financial Market Commission (CMF).
The goal of the above is that no person charged or convicted in Chile for crimes carried out in Chile or abroad related to money laundering and the financing of terrorism can be a director, manager or administrator of these entities, nor acquire or maintain a 10% or more equity interest in them.
Obligation to start economic activities for people who operate in foreign trade
Within this area, the bill obliges people who operate in foreign trade to start economic activities in order to facilitate the work of the SII and the SNA regarding the investigation of infractions and tax and customs offences, as well as the persecution of organized crime.
Those who do not present a plausible or verifiable economic background for the operations they carry out will be subject to investigation and background checks by the SII.
Along the same lines, the bill proposes regulations to make explicit the illegality of exploiting games of chance without legal authorization, strengthening the powers of the Superintendency of Casinos and Games in this area.
With regard to the above, the bill also includes a requirement for prior authorization to be given by the superintendency for the importation of machines.
Greater powers of intrusion and sanctioning
The third area of the Economic Intelligence against Crime bill corresponds to greater powers of intrusion and sanctioning.
Some of the powers of intrusion and sanctioning that are included in the government bill to follow the path of illicit money are:
- A set of measures to strengthen the prosecution of tax and customs crimes
- To establish sanctions for the transport of illegal merchandise
- To improve the sanction of crimes regarding illegal games of chance, qualifying it as the basis of the crime of money laundering
Along with the above, the bill seeks to modernize and strengthen the internal procedures to which the UAF, SII and SNA are subject for the investigation and punishment of crimes within the scope of their powers.
Finally, the bill includes regulations to allow means of payment to be blocked in the event of suspicious conduct.