What an obligated entity is
An obligated entity is a natural or legal person on whom the law imposes duties to prevent money laundering and terrorist financing. In essence, they are the companies and professionals that —because of the nature of their activity— could be used as a channel to move illicit funds, and that is why they must know their customers, assess risks and report anything suspicious.
Financial vs. non-financial
Law 23 of 2015 distinguishes two large groups:
- Financial obligated entities: financial system entities, such as banks, insurers, securities firms and cooperatives, supervised by the sector regulators.
- Non-financial obligated entities and activities carried out by professionals: a set of designated businesses and professions (known internationally as DNFBPs) that, without being part of the financial system, must meet prevention obligations.
Non-financial activities covered
Among the non-financial activities that are usually covered are:
- Lawyers and law firms when carrying out certain activities (companies, real estate, handling of funds).
- Accountants and accounting firms.
- Real estate developers and agents.
- Casinos, gaming rooms and betting.
- Dealers in precious metals and stones, and jewelers.
- Free trade zones and Colón Free Zone companies.
- Trust companies and corporate service providers.
Do you operate in one of these sectors? We have specific guides for lawyers, accountants and real estate companies.
What they must comply with
With nuances depending on the activity, the typical obligations are:
- Know the customer and their beneficial owner (due diligence).
- Check against sanctions lists and PEPs, and assess the risk.
- Apply enhanced due diligence in higher-risk cases.
- Report suspicious activity to the FIU.
- Keep the evidence and have policies and, depending on the case, a compliance officer.
How to comply without friction
The challenge is usually not understanding the obligation, but meeting it in an agile way and leaving evidence. Akifue brings together sanctions screening, PEP screening, KYC and vendor due diligence in a single console, with an exportable case file for each check.
This content is informational and does not constitute legal advice. The list of covered activities and their specific obligations depend on the current text of Law 23 and its regulations; consult the official sources and a professional for your specific case.