Ministry of Internal Affairs gets new powers in banking area

On October 20, 2022, the Russian President signed the law entitling the Bank of Russia to inform the Ministry of Internal Affairs of incidents and attempts to transfer monies without consent of the client.

The Ministry of Finance believes that the new approach will help combat bank card fraud which has become extremely common. However, lawyers and businessmen are worried that the police will get access to personal data and will be able to see the amounts kept on an individual’s bank account, as well as their registered and actual residence addresses. According to some members of the public, this increases the risk that law enforcement agencies might take advantage of the banking information.

Are there any risks of disclosure of personal and banking information?

We should note the following:

• The amendments to laws will only take effect in a year, meaning that the Ministry of Internal Affairs is not granted any new powers right now. During this year, the Central Bank and the Ministry of Internal Affairs need to draw up in depth the documents determining database access rules and take into account all potential risks, both internal and external, and the ways to minimize them.
• This concerns only the access to the system under the auspices of the Bank of Russia for information exchange between financial market participants, law enforcement authorities, communications providers and operators, system intergrators, antivirus software developers and other companies engaged in the information security area. The system is used by a broad range of participants, but the amendments do not imply access to all banking databases, accounts or personal data.
• In addition to the Ministry of Internal Affairs, other law enforcement agencies, such as the Federal Security Service (FSB), Prosecutor’s Office and Investigative Committee, also deal with and handle bank card fraud crimes. However, the amendments concern the access to the information exchange system only for the employees and officials of the Ministry of Internal Affairs. It is assumed that other law enforcement agencies are currently not hindered in obtaining access to banking secrets.

To sum up
It is unlikely that this approach will entail any new adverse consequences. Will it help to fight fraud more effectively? We would like to believe so.

This review is provided by Alexey Mayakov, Of Counsel of the Criminal Law Practice at Capital Legal Services