What are the money laundering offences under the AML/CFT Law, and what defences exist?
The offences the law covers, the two penalty tiers for laundering, the protection for people who report their suspicions, legal privilege, disclosure orders and the offence of giving false identity information.
By the ExamPass CY editorial teamLast reviewed 6 min read
On this page
- Short answer
- Offences and defences at a glance
- Which offences does the law cover, and what are the penalties for laundering?
- How does reporting a suspicion protect a person?
- What are privileged information and disclosure orders?
- What happens if someone gives a firm false identity information?
- How to think about it
- Common mistakes
- Legal references
- Practise this topic
Short answer
Law 188(I)/2007 covers two kinds of prescribed offences: money laundering offences and the predicate offences that generate the proceeds. Anyone who knew that property came from crime and deals with it faces up to 14 years in prison and/or a €500,000 fine; anyone who ought to have known faces up to 5 years and/or €50,000. Disclosing a suspicion to MOKAS, or for staff of supervised firms to their AML compliance officer, gives protection. Knowingly giving false identity information or forged documents to a firm carries up to 2 years and/or €100,000.
Offences and defences at a glance
| Provision | Rule |
|---|---|
| Prescribed offences (Article 3) | Money laundering offences and predicate offences |
| Laundering by a person who knew (Article 4) | Up to 14 years' imprisonment and/or a fine of up to €500,000 |
| Laundering by a person who ought to have known (Article 4) | Up to 5 years' imprisonment and/or a fine of up to €50,000 |
| Protected disclosure (Article 26) | A good-faith report to MOKAS, or by staff to their AML compliance officer, breaches no contractual restriction; the reported act is not an offence if done with MOKAS or police consent, or reported promptly on the person's own initiative |
| Legal privilege (Article 44) | Lawyer–client communications for legal advice or proceedings, but never those made to commit an offence |
| Disclosure order (Article 45) | A court can order information or documents to be disclosed to an investigator |
| False identity information or forged documents (Article 68C) | Up to 2 years' imprisonment and/or a fine of up to €100,000 |
Source: Law 188(I)/2007, Articles 3, 4, 26, 44, 45 and 68C, as amended up to 2026.
Which offences does the law cover, and what are the penalties for laundering?
The AML/CFT Law applies to prescribed offences, of which there are two kinds: money laundering offences and predicate offences. A predicate offence is any offence that a Cyprus law makes a criminal offence.
A laundering offence is committed by anyone who, knowing or when they ought to have known that property of any kind is the proceeds of crime, converts, transfers or moves it to hide its origin, conceals its true nature, source, location, movement or ownership, acquires, possesses or uses it, takes part in or assists any of these acts, or passes on information about an investigation so that the offender can keep the proceeds. The two tiers of penalty follow the person's state of mind: up to 14 years in prison and/or €500,000 for someone who knew, and up to 5 years and/or €50,000 for someone who ought to have known. The concept is explained further in the notes on money laundering and its stages.
Terms used in this note
- Prescribed offence
- An offence to which the AML/CFT Law applies: a money laundering offence or a predicate offence.
- Protected disclosure
- A good-faith report of suspicion to MOKAS, or internally to the AML compliance officer, which protects the reporter from liability.
- Privileged information
- Lawyer–client communications for legal advice or proceedings, which cannot be forced into evidence unless made to commit an offence.
How does reporting a suspicion protect a person?
A person charged with helping another to launder money has a defence if they prove that they intended to disclose their suspicion, or the facts behind it, to MOKAS and that there was a reasonable excuse for not doing so.
A person who discloses a suspicion or belief to MOKAS in good faith is not in breach of any contractual restriction on disclosure and incurs no liability for it. They do not commit a laundering offence in relation to the act they disclosed if it was done with the consent of MOKAS or a police officer after the disclosure, or, where the act came first, if they disclosed it on their own initiative and without delay as soon as it was reasonable to do so. Not executing, or delaying, a transaction on MOKAS's written instructions is not a breach of contract either.
For employees of firms supervised by CySEC or any other supervisory authority named in the law, these protections apply to disclosures, or intended disclosures, to the firm's AML compliance officer. Staff report internally, and the compliance officer decides whether to report to MOKAS.
What are privileged information and disclosure orders?
Communications between a lawyer and a client for legal advice, or for professional services in connection with legal proceedings, whether or not they have started, are privileged information, and their disclosure in legal proceedings is protected. A communication made for the purpose of committing a prescribed offence is never privileged.
In investigations of prescribed offences, or to trace proceeds and assets for freezing or confiscation, a court may, on an investigator's application, order a person to disclose information or documents. The person must also tell the investigator promptly about any later change to the information given, or any new information on the same subject.
What happens if someone gives a firm false identity information?
It is an offence for a customer, a person acting on the customer's behalf, or a third party on whom the firm relies for CDD, knowingly to give false or misleading information about the identity of the customer or the beneficial owner, or to provide false or forged identification documents. The penalty is up to 2 years in prison and/or a fine of up to €100,000.
How to think about it
Sort each provision by who it protects or punishes. The launderer: 14 years and €500,000 if they knew, 5 years and €50,000 if they ought to have known. The honest employee: protected by reporting, internally to the compliance officer in a supervised firm. The lawyer: privileged for advice, never for helping a crime. The customer who lies about identity: 2 years and €100,000. When a question mixes a prison term from one tier with a fine from another, it is wrong.
Common mistakes
Pairing 14 years with €50,000, or 5 years with €500,000. The tiers are 14 years/€500,000 for knowledge and 5 years/€50,000 for ought to have known.
Thinking staff must report directly to MOKAS. In supervised firms, disclosure to the AML compliance officer gives the protection; the officer reports onwards.
Treating all lawyer–client communications as privileged. Communications made to commit an offence are never privileged.
Confusing the false-information penalty with other offences. Giving false identity information or forged documents carries up to 2 years and/or €100,000.
Legal references
- The Prevention and Suppression of Money Laundering and Terrorist Financing Law of 2007 (Law 188(I)/2007), consolidated Greek text on CyLaw (amendments up to Law 25(I)/2026) (opens in a new tab)
Article 3: prescribed offences · Article 4: laundering offences and penalties · Article 5: predicate offences · Article 26: defences and protected disclosure · Article 44: privileged information · Article 45: disclosure orders · Article 68C: false information and forged documents
- Directive (EU) 2018/1673 on combating money laundering by criminal law (opens in a new tab)
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