Anti-money Laundering : Mexico

1. What laws in your jurisdiction prohibit money laundering?

Mexico

The following laws prohibit money laundering in Mexico:

• the Mexican Constitution; and
• the Federal Criminal Code. 

Additionally, certain states provide within their local Criminal Codes a specific prohibition and sanctions for money laundering.
Also, all financial institutions in Mexico have specific regulations for anti-money laundering compliance matters.

Section 22, paragraph four of the Mexican Constitution provides that assets forfeiture is applicable if the legitimate origin cannot be demonstrated and if such assets are related to investigations derived from, among others, money laundering.  

Sections 400-bis and 400-bis 1 of the Federal Criminal Code establish the applicable penalties for carrying on determined activities such as the acquisition, alienation, administration, guarding, possession, exchange, conversion, deposit, withdrawal, giving or receiving, by any means, investing, transferring, transporting within the national territory, to international territory or vice versa, resources, rights or properties of any nature, when there is knowledge that they were obtained from an illicit activity (money laundering). 

Other activities prohibited by the code are the concealment or intention to hide the nature, origin, location, destination, movement or ownership of resources, rights or property, when there is knowledge that they were obtained from an illicit activity (money laundering).

Along with the Federal Criminal Code, certain local Criminal Codes classify money laundering as a felony. For example, the Mexico City Criminal Code establishes, under section 250, the prohibition of the same activities foreseen in the Federal Criminal Code. The applicability of federal or local regulations must be determined on a case-by-case basis.

Nevertheless, the Federal Criminal Code is applicable to the national territory, so if there is a local code that does not foresee money laundering, the Federal Criminal Code must be applied.

Regarding financial institutions in Mexico, the anti-money laundering provisions are applicable to general bond warehouses, investment advisers, brokerage houses, exchange houses, exchange centres, investment funds, credit institutions (ie, banks), savings and loan cooperatives institutions, multiple-purpose financial institutions (regulated and non-regulated), People’s Finance Corporation (SOFIPO), Community Finance Corporation (SOFINCO), Rural Integration Finance Corporation, money transmitters, credit unions and the National Agricultural, Rural, Forestry and Fishing Development Financial Institution.

2. What must the government prove to establish a criminal violation of the money laundering laws?

Mexico

The Mexican government must prove that one of the assumptions foreseen in section 400-bis of the Federal Criminal Code has been committed:

• the acquisition, alienation, administration, guarding, possession, exchange, conversion, deposit, withdrawal, giving or receiving by any means, investing, transfer, transport within the national territory to international territory, or vice versa, of resources, rights or properties of any nature, when there is knowledge that they were obtained from illicit activity; and
• hide the nature, origin, location, destination, movement or ownership of resources, rights or property, when there is knowledge that they were obtained from illicit activity.

Once the culpability has been proven, a penalty from five to 15 years of prison and fine from 1,000 to 5,000 times the Unit of Measurement and Update (economic reference in Mexican pesos to determine obligations provided in federal and local laws), will be imposed.

In addition to the assumptions foreseen in the Federal Criminal Code, the Prevention, and Identification of Transactions with Illegal Funds Federal Law (Anti-Money Laundering Law) establishes the following sanctions:

Prison time from two to eight years and a fine from 500 to 2,000 times the Unit of Measurement and Update will be imposed on anyone:

• who intentionally provides fake information, documentation, data or images to the person obliged to file the notices regarding vulnerable activities; and
• who intentionally modifies information, documentation, data or images destined to be incorporated in the aforementioned notices.

Prison time from four to 10 years and a fine from 500 to 2,000 times the Unit of Measurement and Update will be imposed on:

• the Federal public officer who unduly manages the information, documentation, data or images to which they have access because of their public charge; and
• anyone who, without authorisation from the competent authorities, divulges by any means the information in which a natural person, legal entity or public server is linked with notices or requirements of information between authorities, related to any vulnerable activity, regardless of whether the notice exists or not. 

3. What are the predicate offences to money laundering? Do they include foreign crimes and tax offences?

Mexico

To be in the presence of the crime of money laundering, first  illicit activity must have been committed from which the illicit resources came. Some examples are tax fraud, human trafficking, kidnapping, fraud, organised crime, among others.

In this regard, the Federal Criminal Code does not distinguish between offences committed in national and foreign territories, therefore the consequences apply to both scenarios. Also, the Federal Criminal Code does not define the crimes to which money laundering may be applicable, so tax offences are included.

4. Is there extraterritorial jurisdiction for violations of your jurisdiction’s money laundering laws?

Mexico

The laws that prohibit money laundering in Mexico are not applicable in extraterritorial jurisdictions.

Nonetheless, Mexico is party to several international treaties regarding extradition and mutual assistance in criminal matters, so if a Mexican national commits the crime of money laundering abroad, Mexico may request their extradition from the national territory.

5. Is there corporate criminal liability for money laundering offences, or is liability limited to individuals?

Mexico

The National Criminal Procedures Code states the possibility of holding corporate entities accountable for their participation in the commission of a crime. Section 421 of the National Criminal Procedures Code establishes that corporate entities will be criminally liable for crimes committed in their name, on their behalf, for their benefit or through the means they provide, when it has been determined that there was also a failure to observe due control in their organisation, regardless of the criminal liability that may be incurred by their legal representatives, administrators or shareholders.

6. Which government authorities are responsible for investigating violations of the money laundering laws?

Mexico

The Financial Intelligence Unit, Tax Administration Service and the Attorney General Department of Justice are the Mexican authorities in charge of investigating anything related to money laundering.

Financial Intelligence Unit (FIU)

According to the Internal Regulations of the Ministry of Finance and Public Credit, the FIU oversees establishing the measures and procedures to prevent and detect illicit activities. This Unit works along with the Prosecutor's Office to join forces and resources to prosecute felonies regarding money laundering.

Tax Administration Service (SAT)

The Internal Regulations of the SAT stipulate that if such authority obtains relevant information regarding money laundering about a taxpayer it must inform the FIU.

Attorney General Department of Justice

This Department’s main function is to investigate and prosecute felonies. To accomplish this function, the Department must act in accordance with the principles that rule the Mexican criminal proceedings. This means that the Attorney General's Department of Justice is in charge of investigating every criminal activity related to money laundering, so that the Public Prosecutor's Office can initiate criminal action against the alleged perpetrator.

7. Which government agencies are responsible for the prosecution of money laundering offences?

Mexico

Money laundering offences will be prosecuted by the Prosecutors Office. Once the Attorney General Department of Justice carries out the proper investigation for the alleged criminal activities, the Prosecutors Office will commence a criminal action. 

It is important to highlight that in accordance with the Mexican regulations, the criminal proceedings are based on the Adversarial System of Criminal Justice. In such process, the Prosecutors Office could request precautionary measures, so the alleged perpetrator does not flee from the justice system. 

8. What is the statute of limitations for money laundering offences?

Mexico

In accordance with the Federal Criminal Code, the offence of money laundering implies a prison time from five to 15 years of prison. To that effect, in Mexico the statute of limitations for felonies is computed by adding the lowest period to the higher one and dividing the product by two. In this specific case, the statute of limitation is 10 years.

It is important to consider that in case of an aggravating circumstance the statute of limitation could be greater.

9. What are the penalties for a criminal violation of the money laundering laws?

Mexico

The Federal Criminal Code establishes penalties that go from five to15 years of prison and an economic sanction that goes from 1,000 to 5,000 times the Unit of Measurement and Update (economic reference in Mexican pesos to determine obligations provided in federal and local laws).

In addition, the Federal Criminal Code establishes that the penalty will be greater if the person that commits the money laundering, is or was (in a period of two years after the end of their tenure), in any position of power regarding an entity that is obliged to the anti-money laundering regime. Another aggravating circumstance is when criminal activity has been committed by a public servant.

10. Are there civil penalties for violations of the money laundering laws? What are they?

Mexico

The penalties for the violation of Mexican money laundering laws are not of civil nature. However, one consequence could be assets forfeiture, which is regulated in section 22 of the Mexican Constitution.

In this regard, assets forfeiture is applicable if the legitimate origin of them cannot be proven and if such assets are related to investigations derived from, among others, money laundering.

This procedure is not part of the criminal prosecution, even though the action to forfeit assets concerns the Prosecutor's Office. In fact, it is a procedure of civil nature of patrimonial character, which will be mostly discussed through oral proceedings.

11. Is asset forfeiture possible under the money laundering laws? Is it part of the criminal prosecution? What property is subject to forfeiture?

Mexico

It is possible, the Mexican Constitution establishes in section 22, fourth paragraph, that assets forfeiture is applicable if the legitimate origin of the assets cannot be proven and if such assets are related to investigations derived from, among others, from money laundering.

The forfeiture will be applicable to all kinds of assets whose legitimate origin cannot be proved and the assets that are related to investigations derived from, among others, from money laundering.

12. Is civil or non-conviction-based asset forfeiture permitted under the money laundering laws? What property is subject to forfeiture?

Mexico

The asset forfeiture procedure is not part of the criminal prosecution, even though the action to forfeiture assets concerns the Public Prosecutor's Office. In fact, it is a procedure of civil nature of patrimonial character, which will be held mostly in oral proceedings.

The forfeiture will be applicable to assets whose legitimate origin cannot be proved and the assets that are related to investigations derived from, among others, from money laundering.

13. Which laws or regulations in your jurisdiction impose anti-money laundering compliance requirements on financial institutions and other businesses?

Mexico

All financial institutions in Mexico have specific regulations for anti-money laundering compliance matters.

The anti-money laundering compliance requirements for other businesses are foreseen in the Prevention and Identification of Transactions with Illegal Funds Federal Law (Anti-Money Laundering Law), its Regulations and its General Rules (applicable to designated non-financial businesses and professions).

14. What types of institutions are subject to the AML rules?

Mexico

Within the financial system, the anti-money laundering provisions are applicable to general bond warehouses, investment advisers, brokerage houses, exchange houses, exchange centres, investment funds, credit institutions (ie, banks), savings and loan cooperatives institutions, multiple-purpose financial institutions (regulated and non-regulated), the People’s Finance Corporation (SOFIPO), Community Finance Corporation (SOFINCO), Rural Integration Finance Corporation, money transmitters, credit unions and the National Agricultural, Rural, Forestry and Fishing Development Financial Institution.

Regarding the designated non-financial businesses and professions, the Prevention and Identification of Transactions with the Illegal Funds Federal Law establishes certain activities that are classified as "Vulnerable", which are the following:

• practice of games with bets, contests or raffles;
• regular or professional issuance or commercialisation of service, credit, prepaid or monetary value storage cards;
• issuance or habitual or professional commercialisation of traveller’s checks;
• regular or professional offering of mutual, loan or credit operations;
• regular or professional provision of construction or development services of real estate, as well as the intermediation and transfer of ownership or constitution of rights related to the sale of the same;
• commercialisation or habitual or professional intermediation of metals and precious stones, jewels or watches;
• auctions or regular or professional marketing of works of art;
• commercialisation or habitual or professional distribution of new or used vehicles (air, sea or land);
• regular or professional provision of armoring services for new or used land vehicles, as well as real estate;
• regular or professional provision of money transfer or custody service;
• provision of professional services independently (without employment relationship and when prepared or performed on behalf of a client:

• sale of real estate or the transfer of these;
• management of resources, values or any other asset;
• management of bank, savings or securities accounts;
• organisation of any type of resource to establish, operate and administer commercial companies;
• constitution, spin-off, merger, operation and administration of legal entities or corporate vehicles, including trusts and the purchase or sale of commercial entities;
• provision of public trust services of notaries and public brokers;
• receipt of donations by non-profit entities;
• provision of foreign trade services as an agent or customs representative to promote the clearance of merchandise on someone else's behalf;
• constitution of personal rights of use or enjoyment of real estate; and
• regular or professional offering to exchange virtual assets through digital or similar electronic platforms or provide means to guard, store or transfer virtual assets.

15. Must payment services and money transmitters be licensed in your jurisdiction? Are payment services and money transmitters subject to the AML rules and compliance requirements?

Mexico

The National Banking and Securities Commission publishes the General Provisions related to the registration for money exchange centres and money transmitters. These Provisions stipulate that, to be considered at such centres or money transmitters, an application must be submitted by the interested parties before the Commission. The National Banking and Securities Commission must issue the licence to be considered as a centre or money transmitter.

As a consequence of obtaining the referred licence, payment service providers and money transmitters must comply with AML identification and reporting regulations.

16. Are digital assets subject to the AML rules and compliance requirements?

Mexico

The Prevention and Identification of Transactions with Illegal Funds Federal Law establishes certain activities that are classified as "Vulnerable". In this regard section 17--XVI of the AMLL foresees the virtual asset exchange as a vulnerable activity.

Such activity is defined as the habitual and professional offering of virtual asset exchange by parties, that are not financial institutions. The exchange must be carried out through electronic, digital or similar platforms, that manage or operate, facilitating or carrying out long and short operations of such assets owned by their clients, or provide means for safekeeping, storing or transferring virtual assets other than those recognised by Banco de México in terms of the Law that regulates FINTECH institutions.

17. What are the specific AML compliance requirements for covered institutions?

Mexico

The covered institutions that carry out vulnerable activities have the following compliance requirements in terms of section 15 of the Prevention and Identification of Transactions with the Illegal Funds Federal Law:

• to establish the necessary measures and procedures to prevent and detect illicit activities, in terms of the Federal Criminal Code, as well as to identify their clients;
• to file reports before the Ministry of Finance and Public Credit regarding acts, transactions and services carried out with their clients and board members, directors, employees and representatives of the legal entities that may incur in any violation to the anti-money laundering regulations;
• to deliver to the Ministry of Finance and Public Credit through the competent authorities the information and documentation regarding the acts, operations and services established before; and
• to maintain the information and documentation about their clients and the acts, transactions and services aforementioned, for a period of time of 10 years.

18. Are there different AML compliance requirements for different types of institutions?

Mexico

Financial institutions (general bond warehouses, investment advisers, brokerage houses, exchange houses, exchange centres, investment funds, credit institutions (ie, banks), savings and loan cooperatives institutions, multiple purpose financial institutions (regulated and non-regulated), People’s Finance Corporation (SOFIPO), Community Finance Corporation (SOFINCO), Rural Integration Finance Corporation, money transmitters, credit unions and the National Agricultural, Rural, Forestry and Fishing Development Financial Institution); each one has different AML compliance requirements since each type of financial institution has its own specific laws and regulations.

Non-financial businesses and professions have the same AML compliance requirements since all the obligors are regulated by the Prevention and Identification of Transactions with Illegal Funds Federal Law (Anti-Money Laundering Law), its Regulations and its General Rules.

The Anti-Money Laundering Law establishes that the specific compliance requirements for non-financial businesses and individuals that carry out vulnerable activities are filing and registration of the company before the Anti Money Laundering Official Website; designation of the Compliance Officer and assessment for its acceptance; assessment on how the notices should be filed before the Anti Money Laundering official website; drafting of the handbook and policies for the compliance of the obligations established in the AMLL and its secondary regulations; drafting of the client’s identification forms; and assessment on how to integrate the client’s identification files.

The financial institutions subject to the anti-money laundering regulations have the obligation to establish the mechanisms and procedures to prevent and detect if any illicit activity is being carried out, as well as to retain information about their clients. The documentation that financial institutions gather must be kept for 10 years and it must be notified to the competent authorities. Also, the reports made by the financial institutions are filed with the National Banking and Securities Commission.

19. Which government authorities are responsible for the examination and enforcement of compliance with the AML rules?

Mexico

The government authorities responsible for the examination and enforcement of compliance with the anti-money laundering rules are the following.

Financial Intelligence Unit (FIU) 

The FIU was created to contribute to the prevention and combat of money laundering. This Unit oversees receiving the notices filed by the entities that execute vulnerable activities in terms of article 17 of the Anti-Money Laundering Law. It is also in charge of analysing financial transactions and filing complaints to the competent authorities in the case of a money laundering offence.

The main tasks of the Financial Intelligence Unit consist of implementing and following up the mechanisms for the prevention and detection of acts, omissions or operations that could favour aid, assist or cooperate in any way in the commission of the crimes stipulated in article 400-bis of the Federal Criminal Code (money laundering).

National Banking and Securities Commission (NBSC)

The NBSC is a decentralised agency of the Ministry of Finance and Public Credit, with the power to authorise, regulate, supervise and sanction the entities that are part of the Mexican financial system, as well as those individuals and entities that carry out activities contemplated in laws related to the financial system.

Tax Administration Service (SAT) 

SAT oversees elaborating the guides and forms to register and present notices regarding vulnerable activities on the Anti Money Laundering official website, as well as to receive said notices. It is responsible for clarifying any questions related to the registry and presentation of the notices mentioned before, and to provide counsel to anyone who carries out vulnerable activities.

Attorney General Department of Justice (AGDJ) 

This Department’s main function is to investigate and prosecute felonies. To accomplish this function, the Department must act in accordance with the principles that govern Mexican criminal proceedings. This means that the Attorney General Department of Justice oversees investigating every act related to money laundering, so that the Public Prosecutors Office can initiate criminal action against the alleged perpetrator.

20. Are there requirements to monitor and report suspicious activity? What are the factors that trigger the requirement to report suspicious activity? What is the process for reporting suspicious activity?

Mexico

In the event that the legal entities have information based on concrete signs or facts to the effect that upon the intention of carrying out a transaction, the funds may come from illegal activities or may be intended to favour, provide help, assistance or cooperation of any kind for the commission of the crime set forth in section 139-quater of the Federal Criminal Code, or that may fall within the presumptive situations of article 400-bis of the same legal system, if they decide to accept such Transaction, they should file a notice before the Financial Intelligence Unit, by means of the Tax Administration Service, within  24 hours of becoming aware of such information.

The financial institutions that have information based on concrete signs or facts that suspicious activity is being carried out must file before the National Banking and Securities Commission within the next 24 hours from the moment they become aware of such information.

21. Are there confidentiality requirements associated with the reporting of suspicious activity? What are the requirements? Who do the confidentiality requirements apply to? Are there penalties for violations of the confidentiality requirements?

Mexico

The Prevention and Identification of Transactions with Illegal Funds Federal Law foresees in its section 22 that the filling of notices, information, and documentation of those who carry out Vulnerable Activities shall not imply any transgression to the obligations of confidentiality or secrecy.

Board members, the Compliance Officer, as well as the directors, officers, employees, and legal representatives of the Companies, should maintain absolute confidentiality on the information related to the filing of anti-money laundering Notices except when it is required by the Financial Intelligence Unit, the Tax Administration Service and the other Authorities expressly empowered to do so.

The information and documentary evidence of the Notices, as well as the identity of those that have filed them and, if applicable, of the representatives appointed by the Persons Responsible for Compliance with the Prevention and Identification of Transactions with Illegal Funds Federal Law is deemed confidential and reserved under the terms of the Protection of Personal Data in Possession of Private Individuals Federal Law.

22. Are there requirements for reporting large currency transactions? Who must file the reports, and what is the threshold?

Mexico

Section 17 of the Prevention and Identification of Transactions with Illegal Funds Federal Law lists 16 activities that must be considered as vulnerable. There are two different thresholds to be considered: one for the identification of such activity and the other one for filing pertinent notices.

Financial institutions have a “Relevant Operation Report”, whether a transaction should be considered relevant or not will depend on the type of financial institution involved. Thus, a transaction in cash for 130,000 Mexican pesos will be considered relevant if it is carried out with a financial technology institution, but it will not be relevant for a Credit Institution (ie, bank).

23. Are there reporting requirements for cross-border transactions? Who is subject to the requirements and what must be reported?

Mexico

The anti-money laws and regulations in Mexico do not distinguish between transactions made in national or foreign territory, if the obligor is established in Mexican territory, therefore such obligors must comply with the obligations regardless of the location of the customer if they carry out one of the activities that are classified as "Vulnerable", which are the following:

• practice of betting games, contests or raffles;
• regular or professional issuance or commercialisation of service, credit, prepaid or monetary value storage cards;
• issuance or habitual or professional commercialisation of traveller's checks;
• regular or professional offering of mutual, loan or credit operations;
• regular or professional provision of construction or development services of real estate, as well as the intermediation and transfer of ownership or constitution of rights related to the sale of the same;
• commercialisation or habitual or professional intermediation of metals and precious stones, jewellery or watches;
• auctions or regular or professional marketing of works of art.
• commercialisation or habitual or professional distribution of new or used vehicles (air, sea or land);
• regular or professional provision of armoring services for new or used land vehicles, as well as real estate;
• regular or professional provision of money transfer or custody services;
• provision of professional services independently (without employment relationship and when prepared or performed on behalf of a client:

• sale of real estate or the transfer of these;
• management of resources, values or any other asset;
• management of bank, savings or securities accounts;
• organisation of any type of resource to establish, operate and administer commercial companies;
• constitution, spin-off, merger, operation and administration of legal entities or corporate vehicles, including trusts and the purchase or sale of commercial entities;
• provision of public trust services of notaries and public brokers;
• receipt of donations by non-profit entities;
• provision of foreign trade services as an agent or customs representative to promote the clearance of merchandise on someone else's behalf;
• constitution of personal rights of use or enjoyment of real estate; and
• regular or professional offering to exchange virtual assets through digital or similar electronic platforms or provide means to guard, store or transfer virtual assets.

24. Is there a financial intelligence unit (FIU) or other government agency responsible for analysing the information reported under the AML rules?

Mexico

By Decree published in the Official Gazette of the Federation on 7 May 2004, the Financial Intelligence Unit (FIU) was created. The FIU was created to contribute to the prevention and combat of money laundering. This Unit oversees receiving the notices filed by the entities that execute vulnerable activities in terms of article 17 of the Anti-Money Laundering Law. It is also in charge of analysing financial transactions and filing complaints to the competent authorities in case of a money laundering offence.

The main tasks of the Financial Intelligence Unit consist of implementing and following up the mechanisms for the prevention and detection of acts, omissions or operations that could favour, aid, assist or cooperate in any way in the commission of the crimes stipulated in article 400-bis of the Federal Criminal Code (money laundering).

25. What are the penalties for failing to comply with your jurisdiction’s AML rules, and are they civil or criminal?

Mexico

The penalties for not complying with the anti-money laundering regulations can be of administrative or criminal nature.

Administrative penalties

The fines determined under the terms of this Law will have the nature of tax liabilities and will be stipulated in a liquid amount and will be subject to the administrative execution procedure established by the applicable laws. The penalties are measured in Unit of Measurement and Update (economic reference in Mexican pesos to determine the amount of payment of obligations provided in federal and local laws). 

Between 200 and 2,000 times the Unit of Measurement and Update

Abstention from complying with the requirements formulated by the Competent Authorities; non-compliance with the obligation to identify their clients; request information on their occupation in the event that a business relationship is established; question the client or user on the existence of the ultimate beneficial owner; guard, protect, safeguard and prevent the destruction and concealment of the information and documentation that may be used to support the vulnerable activity, and save this information for at least five years, as well as hindering the verification visits and finally filing the notices extemporaneously; non-compliance with the obligation to timely file notices (within a 30-day term as of the date of the transaction); and if the notices that are sent fail to comply with the requirements set forth in the Anti-Money Laundering Law.

Between 10,000 and 65,000 times the Unit of Measurement and Update or between 10 and 100 per cent of the value of the file, act, or transaction, whichever is greater

Not complying with the filing of the notices and not complying with the restrictions on the use of cash and precious metals.

Criminal penalties

The Federal Criminal Code establishes penalties for the commission of activities such as the acquirement, alienation, administrations, guarding, possession, exchange, conversion, deposit, withdrawal, giving or receiving by any means, investing, transfer, transport within the national territory, from it to international territory or vice versa, resources, rights or properties of any nature, when there is knowledge that they were obtained from illicit activity.

Other activities prohibited by the aforementioned code are the concealment or intention to hide the nature, origin, location, destination, movement or ownership of resources, rights or property, when there is knowledge that they were obtained from illicit activity.

In addition to the description of the prohibited activities, the Federal Criminal Code enunciates that the penalty will be greater if the person that commits them is or has been, for the last two years, in any position of power regarding an entity that is obliged to the anti-money laundering regime. Another aggravating circumstance is when criminal activity has been committed by a public server.

Once the culpability of the charged person has been proven, the penalty goes from five to 15 years of prison and an economic sanction that goes from 1,000 to 5,000 times the Unit of Measurement and Update.

26. Are compliance personnel subject to the AML rules? Can an enforcement action be brought against an individual for violations?

Mexico

The compliance personnel (like a compliance officer) in charge of complying with the obligations set forth in the anti-money laws and regulations in Mexico should be registered before the Ministry of Finance and Public Credit.

To date, the Prevention and Identification of Transactions with Illegal Funds Federal Law does not stablish any positive or negative consequence for said designation nor special requirements to be appointed so it can be concluded that no enforcement action can be brought against compliance personnel.

27. What is the statute of limitations for violations of the AML rules?

Mexico

According to the Prevention and Identification of Transactions with Illegal Funds Federal Law, legal entities that carry out vulnerable activities should guard, protect, safeguard and prevent the destruction and concealment of the information and documentation that may be used to support the vulnerable activity, as well as the documentation that serves to identify their clients, which must be preserved for a five-year-term counted as of the date in which such activity was carried out.

The financial institutions subject to the anti-money laundering regulations have the obligation to establish the mechanisms and procedures to prevent and detect if any illicit activity is being carried out, as well as to retain information about their clients who execute vulnerable activities. The documentation the financial institutions gather must be safeguarded for a 10-year term.

28. Does your jurisdiction have a beneficial ownership registry or an entity or office that collects information on the beneficial ownership of legal entities?

Mexico

Mexico does not have a beneficial ownership registry. However, the Prevention and Identification of Transactions with Illegal Funds Federal Law and the Federal Tax Code establishes the obligation to obtain and keep the information of their ultimate beneficial owners.

In this regard, the Federal Tax Code establishes an obligation for legal entities, trustees, settlors or trustees, in the case of trusts, as well as the contracting parties or members, in the case of any other legal entity, of obtaining and keeping, as part of their accounting record the information of their ultimate beneficial owner. This information must be provided to the Tax Administration Service, when expressly required by such authority.

In terms of the applicable provisions, there is no person who is responsible for the maintenance of such information, nonetheless, the compliance officer should be responsible to gather and maintain such information. 

This information must be provided to the Tax Administration Service, when expressly required by such authority, and will be part of the identification files of the customers. Such information will be able only to the Tax Administration Service, when required.