The Ministry of Finance of the Russian Federation will tighten control over gold purchases

The Ministry of Finance and Rosfinmonitoring are proposing to increase the level of control over banking transactions involving precious metals.

By doing this, they will be able to decrease their shadow turnover and enhance their efforts to combat money laundering.

Izvestia reports that authorities are currently in the process of creating a bill that would require banks to monitor all operations involving precious metals. Currently, credit institutions are not obligated to check these transactions.

Money laundering schemes often involve operations with jewelry, precious metals, and stones.

Rosfinmonitoring has specified that control over money laundering in operations with precious metals will be extended, particularly to the purchase of gold bars, coins, and diamonds in banks.

Rosfinmonitoring will be provided with information about all financial transactions subject to control under 115-FZ by credit institutions in the same manner as is currently done.

The draft law also proposes a new control measure: a list of market participants who breach the regulations in the precious metals sector will be compiled. Banks will be able to deny customers financial transactions based on this list.

The press service of VTB has expressed that not all of the banks surveyed by Izvestia are in favor of the initiative. They have also noted that the implementation of such a check would require additional labor and financial investments.

In 2022, due to the crisis, the 20% tax on the purchase of gold bullion in banks was abolished, resulting in a surge of buying the precious metal.

In the past year, 13 systemically important banks sold a total of 57 tons of gold to the public, with 5 of them accounting for the majority of the sales. However, the World Gold Council estimated that the demand for gold from Russians in 2021 would be 10 times lower than the previous year, at 5.3 tons.