INFORMATION EXCHANGE TOOLS IN THE FINANCIAL MONITORING SYSTEM OF THE USA AND BENCHMARKING FOR UKRAINE

Abstract

The article examines the tools of interaction between the participants of the US financial monitoring system, which are not used in Ukraine. These tools help the financial intelligence unit to get better information, to respond faster to crimes by freezing funds or returning them to their rightful owner. The relevance of the study is determined by the high risks of legalization of funds and financing of terrorism in the Ukrainian economy and the risks of conducting financial transactions related to states that carry out armed aggression against Ukraine.
 To reveal possible ways of increasing the effectiveness of the financial monitoring system of Ukraine by introducing information exchange tools operating between the participants of such a system in the USA.
 An important element of the US financial monitoring system is the ability of financial institutions to exchange restricted information about the clients of such institutions. This right is granted to them under Section 314(b) of the USA PATRIOT Act of 2001. In addition, associations of financial institutions have a similar right. When appropriate, financial institutions also have the authority to create a joint suspicious activity report, which is then forwarded to the US Financial Intelligence Unit. Another important element of rapid interaction is the ability of US law enforcement agencies to transfer information about cybercrimes to the US financial intelligence unit through the Rapid Response Program, introduced in 2015. This practice allows the financial intelligence unit to quickly contact financial intelligence units in other countries and effectively block illegally obtained funds abroad or return them to victims in the United States.
 The current legislation of Ukraine in the field of financial monitoring does not allow primary financial monitoring entities to exchange information with limited access among themselves or between specialized associations. This prohibition leads to an increase in the time for processing a suspicious transaction and reduces the quality of the final conclusion reached by the primary financial monitoring entity. Also, the current legislation of Ukraine does not allow law enforcement agencies to provide information to the financial intelligence unit of Ukraine regarding open criminal cases (except for cases that were opened based on generalized and additional generalized materials of the financial intelligence unit), which limits the ability of financial intelligence to fully perform its functions in international cooperation.