Modern indicators of financial crimes detection and their prevention in Ukraine

The increase in the level of financial crime is caused by the technological development, weak moni-toring of financial institutions, low level of international cooperation in terms of combating these types of crimes. The paper aims to develop effective ways to combat financial crimes in Ukraine. With the help of a systematic analysis of financial crime modern indicators, theoretical sources, prac-tical measures and international experience, the main indicators of financial crimes are identified. Such indicators are the use of false documents and other people's accounts, international payment systems; frequent and complex financial transactions of a confusing nature; unusual for a client amounts and counterparties of the transaction; incomplete or missing payment information. The study has found that the increase in the level of financial crime is influenced by the presence of off-shore zones, the low level of liability for the crime, the reluctance of financial institutions to interact with law enforcement agencies in regard to combating such crimes. It is possible to increase the level of financial crime counteraction by conducting an external audit and investigation of financial crimes, establishing international cooperation to combat such crimes, blocking suspicious financial transactions, taking preventive measures and combating related crimes.

Negative Effect of Current Account Surplus on Long-term Growth; Focused on the Cases of Japan, S. Korea and China

It is a teaching of current economics that the surplus of current account in international payment contributes to the increase of income. But it has got a negative effect on the long-term growth in the reality, which is easily proved by some instances. First, the Japanese growth rate has been very low despite its current account maintaining a huge surplus. Second, it is another instance that South Korea has suffered from its low growth rate even if its government has enforced the policy to defend its exchange rate from declining while its current account surplus has become large since 1998. Next, the growth rate of China has decreased from the time when its foreign reserve has begun to reduce despite its huge surplus of current account. This paper clarifies the reason why their growths are stagnant despite their huge surpluses in current account. If this paper changes the policies of above countries, it would resolve their economic difficulties and settle the imbalance of the world economy. And this paper would contribute to the evolution of economics.

Development of New Payment Systems in Russia Similar to a CLS Analogue

This paper examines the need to create new infrastructural payment and financial institutions in Russia to ensure greater independence of the Russian financial market from any external factors as well as the efficiency of the market for ruble conversion transactions and cross-border payments. The issue of creating an analogue of Continuous Linked Settlement (CLS) in Moscow on the basis of the Interstate Bank, or establishing a new payment system, is highly relevant. Almost seven years ago, on September 22, 2014, the CLS international payment system postponed the inclusion of the Russian ruble in its list of currencies, scheduled for November of that year. The prospect of such inclusion in the coming years remains very weak. In March 2014, VISA and MasterCard payment systems stopped servicing cards of several Russian Banks in retail outlets and ATMs. Amendments to the Federal Law “On the National Payment System” were prepared and promptly adopted in order to provide infrastructure and information support for the processes of making money transfers within Russia. On July 23, 2014, the National Payment Cards System was launched, which was tasked with creating an operational and clearing center for processing domestic transactions with cards of the international payment systems and promoting the national payment card. This experience should be used to create new payment systems in order to secure the efficiency of cross-border payments and currency conversion operations. This step will extend the sphere of ruble convertibility, ensure an increase in the status of the ruble and its importance in international trade, and bring Russia closer to practical steps to create a regional international financial center. To expand settlements in rubles on the part of non-residents, it is necessary to strive to perform trade and financial transactions in rubles and keep ruble savings, which is impossible without a market for ruble conversion transactions. The author examines the prospects for creating a new payment system, in particular with participation of the CIS and BRICS countries.

LEGAL PROTECTION TOWARDS EXPORTERS AND IMPORTERS IN INTERNATIONAL TRADE TRANSACTIONS USING LETTER OF CREDIT (L/C) AS A PAYMENT SYSTEM AT PT. BANK MAYBANK INDONESIA TBK BRANCH OF BENGKULU

This study aims to examine and to analyze the legal protection of exporters and importers in international trade transactions using Letter of Credit (L/C) as a payment system at PT. Bank Maybank Indonesia Tbk branch of Bengkulu. The type of this study was normative legal research with descriptive analytical research design. The result of this study indicated that in an international payment system that used L/C, both exporters and importers were protected, thus exporters did not have to worry about their goods not being paid for, while importers did not need to worry that the goods they bought did not arrive or that they would lose payment, because the bank would guarantee this matters if the required documents were appropriate. PT. Bank Maybank Indonesia Tbk branch of Bengkulu, in protecting its customers, must have considerations both based on the provisions of national banking regulations and based on the applicable banking practices. The efforts made by banks to protect exporters and importers were such as banks have to implement good corporate governance, apply Know Your Customer principles including the principle of prudence in providing L/C facilities, apply the Know Your Employee principle. Moreover, it was necessary to apply optimal sanctions in case of violation of procedures. The L/C arrangements at PT. Bank Maybank Indonesia Tbk branch of Bengkulu adheres to UCP 600 so that it can avoid differences or misinterpretation between the transacting parties as far as possible.

Payment Systems in Ukraine and Risks of their Functioning

The article is aimed at defining the main aspects of the development of the current state of electronic payment systems in Ukraine and generalizing the main risks of violation of their functioning. The carried out research systematized information on the functioning of payment systems (both internal and international) and forms of payments in Ukraine (cash, non-cash – electronic). Among more than 80 domestic and international payment systems created by banks and non-bank institutions, the National Bank of Ukraine defines the following categories of importance of payment systems in Ukraine in order to ensure their continuous and stable functioning – systemically important, socially important and important. It is determined that in Ukraine at the legislative level, taking into account world trends, the payment infrastructure is being actively modernized, especially in the direction of protection of the rights of financial services consumers in the online space. Along with the advent of new technologies of electronic banking, opportunities to diversify the product range of remote services, atypical threats to traditional banking activities of both the internal and the external nature arise. The research systematizes the key risks inherent in functioning payment systems: legal, financial (total commercial risk, liquidity risk, commercial risk), settlement, operating, systemic. It is determined that the main risk in the banking and non-banking sectors is operational risk – the risk of loss of profit due to errors in the implementation of daily routine financial transactions. Prospects for further research in this direction are to find and implement effective mechanisms for minimizing or preventing risks of electronic payment systems.

Application of “blockchain” and “smart contract” tehnology in international payments – the case of reimbursement banks

The aim of this paper is to find alternative method of executing reimbursement loan, as a form of documentary loan, that is, to investigate new digital technology methods (fintech) to improve the efficiency of the international exchange. Reimbursement loans are often used to credit the trade of overseas goods. The reason of such case is that the shipment of goods by the maritime transport requires a significant amount of time and those trades are often associated with high financial amounts. Since international trade (exchange) is a kind of a generator of society’s progress, it is necessary to explore the possibilities for making international payment cheaper, more efficient and more secure. In this case, we based our research on the implementation of modern technologies, more precisely “blockchain”/DLT (Distributed Ledger Technology) and “smart contracts”. The new reimbursement loan model presented in the paper is based on the aforementioned technologies. It could potentially change not only the documentary lending techniques, but also, eventually, overall financial paradigm. The effectiveness of the application of modern technologies is proven comparing the results of the so called conventional and unconventional reimbursement credit model on a real case involving two companies in Indonesia and Singapore. The paper also tackles on the further implementation of “smart contract” technology and “blockchain”/DLT, thus considering the potential impact of these technologies on overseas trade, credit markets and financial institutions. Finally, the paper argues on the limitations in implementing this new technique (e.g. legal, political and technical challenges).

IRANIAN PAYMENT SYSTEM “SHETAB” AND PROSPECTS OF THE IRANIAN BANK CARD SYSTEM IN FOREIGN COUNTRIES

Since the imposition of sanctions on the Republic of Iran, no international payment system has been established in the country. As a result, Iran implemented a solution to the described problems without attracting external assistance, in particular, the Shetab payment system was created and its connection to ATM networks in Bahrain, Qatar, the UAE and Kuwait was implemented. Iran also introduced the Shetab Bank card system, which is extended to Armenia and Turkey. The impact of bilateral payment system on economic growth and increase in cash turnover between two countries, during the period of economic sanctions, has been considered in the article.