Ukrainian President Volodymyr Zelensky signed into law a bill meant to fight tax evasion, which widens the list of data banks can disclose to National Police and enabling credit unions to allocate donors’ loans in foreign currencies.
While the bill was approved by Ukrainian lawmakers last month, it can only come into force after the president’s signing, which Zelensky did on Wednesday, Nov. 6, the parliament website reported.
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The law obliges banks to provide information “no later than” the 24 hours after police request it.
Before the law, police could already request information about bank account numbers, leftover cash on accounts, debit card numbers and financial transactions.
Now, banks should also provide information about the date, sum, currency of financial transactions, as well as geolocation, IP address, and cash register address of transactions.
Banks can provide this information if requested to by Ukraine’s prosecution office, State Security Service, State Bureau of Investigation, National Anti Corruption Bureau, National Police of Ukraine, National Agency for Corruption Prevention and National Agency Responsible for Arrested Assets Management (ARMA).
If there is a request, banks should also provide identifying data for the one who received the transaction, the name and code of the financial institution providing the transaction (acquire), payment device identification number, and financial transaction identification code.
Other amendments
Bill 11043 also includes amendments intended to create a better regulatory environment for financial services to the disabled, strengthen cyber security requirements, and enact higher fines for financial market violations.
The law enables credit unions to allocate donors’ loans in foreign currencies, something intended to help small businesses in villages and small towns where bank services may not be available.
Fight against “drops”
The law is intended to help the National Bank to better fight against “drops.”
Drops are individuals who provide their bank account data, PIN codes, and access to web banking to a third party and get rewards for using cards for transactions.
These transactions do not show real income – cards are used as transit tools to allocate illegal income.
The new list of data may enable law enforcement to see all counter agents enabling tax evasion through “dropping.”
The law stirred debate
Law enforcement will now have a chance to find out the locations of individuals, something which might be concerning for Ukrainians wanting to avoid conscription or who seek to protect the privacy of their banking.
Opponents argued that the law opens a path for police to violate human rights.
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