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  • Writer's pictureBrandon Guillermo Lopez Moreno

Non-profit Organization Obligated to Follow Money Laundering Prevention Rules


To have a legal entity as a Non-profit Organization (NPO) dedicated to helping society and thus receiving donations, commonly known as a “donee”, carries a lot of fiscal responsibilities, and throughout our trajectory some important aspects have been mentioned on our website; but in this particular occasion we will focus on the legal issues regarding these kind of entities, leaving the accounting approach on the side, and showing that ignorance does not exempt the responsibilities with the law.


But what does it mean by ignorance does not exempt the responsibilities with the law?


Sometimes when the right team of advisors is not available this question can have quite a few unfavorable implications before the authorities, and most of the times when they learn of this negligence it is way too late to be able to repair the damage done, and that is why we specialize in not leaving you and your organization unnoticed of all the requirements that the law states.


We bring to your attention that there is a law known as Federal Law for the Prevention and Identification of Operations with Resources derived from Illicit Sources (Ley Federal para la Prevención e Identificación de Operaciones con Recursos de Procedencia Ilícita- LFPIORPI in Spanish), which is in charge of regulating Money Laundering Prevention, hence a donee is under constant surveillance before the eyes of the authorities because its social purpose can be embezzled; the previously mentioned law indicates certain necessary requirements for the smooth running of these kind of entities, and our consultants can advise you in a more specific manner.


In general terms…


This law was created in Mexico based on international rights; there is an intergovernmental body established in 1989 called the Financial Action Task Force (FATF). FAFI’s mandate is to set standards and promote the effective execution of legal, regulatory and operational measures to combat the laundering of assets, terrorist financing and the financing and proliferation of other threats to the integrity of the international financial system.


That being said, to keep the adequate running of our donee, it is necessary to file notices, to create manuals and records that can help us show the authorities the correct routing of assets in our organization and thus avoid sanctions that can affect its functioning.


We want to extend a kind invitation to ask our legal and accounting consultants more about the correct functioning of your Non-profit Organization and with our help avoid the costly infringements which can occur when not properly informed about the LFPIORPI and its regulations. We will gladly clear up any doubts or concerns for the sound management of your organization.

 

Published on May 10th, 2019. “In terms of article 89 of the Fiscal Code of the Federation in force, the content of this reproduction, exhibition, presentation, program, or transmission and/or the documents and/or examples used to expose it, may express positions that do not coincide with the criteria of the Mexican tax or judicial authorities. This reproduction or exhibition is not intended and may not be used by any person for the purpose of circumventing (i) a federal, local, or municipal tax, or (ii) the imposition of tax penalties in the United Mexican States. Terán Rojas & Asociados is not responsible for the use or the criteria that any user may give or have derived from this reproduction or exhibition.” Likewise, the exhibitor/author is responsible for the originality and content of the work in front of the company and for the invasion or affectation of third-party rights that may be caused, so it is obliged to take out the company in peace and safety and to respond for the damages and / or losses that are caused

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