Norm on Imposing Sanctions on Supervised Entities and Other Obligated Subjects for Non-Compliance with Measures Regarding the Freezing of Funds or Other Assets Related to Terrorism, Proliferation of WMDs and Their Financing

CERTIFICATION OF RESOLUTION
RUTH ELIZABETH ROJAS MERCADO, Secretary of the Monetary and Financial Board, CERTIFIES: that in Ordinary Session number twenty-one of the Monetary and Financial Board, held on June 3, 2026, Resolution No.
CDMF-XXI-2-26 was unanimously approved, which literally states:
Monetary and Financial Board
Ordinary Session No. 21
Wednesday, June 03, 2026
RESOLUTION CDMF-XXI-2-26
THE MONETARY AND FINANCIAL BOARD
CONSIDERING
I
That in accordance with Article 105 of the Full Text of the "Political Constitution of the Republic of Nicaragua," banks and other financial institutions, private and state-owned, are supervised, regulated and overseen by the Superintendence of Banks and Other Financial Institutions, in accordance with the laws on the matter.
II
That in accordance with Articles 9, numeral 1), and 30 of Law No. 977, "Law Against Money Laundering, Terrorist Financing and Financing of the Proliferation of Weapons of Mass Destruction," hereinafter Law No. 977, whose consolidated text is contained in Law No. 1175, "Law of the Nicaraguan Legal Digest on Banking and Finance Matters" (hereinafter, the Legal Digest), published in La Gaceta, Official Gazette No. 153, of August 20, 2024, and its subsequent reforms, it is the authority of the Superintendence of Banks and Other Financial Institutions, hereinafter the Superintendence, regarding the obligated subjects under its supervision and within the scope of preventing money laundering, terrorist financing and the financing of the proliferation of weapons of mass destruction, to establish the administrative measures that give operational effect to said law, supervise with a risk-based approach that the obligated subjects implement their AML/CFT/CPF obligations and impose corrective measures and administrative sanctions when appropriate. III That Article 36 of the same Law No. 977, empowers supervisors to "order the implementation of corrective measures and impose sanctions on Obligated Subjects and/or their directors, administrative managers and compliance officers, as appropriate, for the non-compliance with the AML/CFT/CPF obligations applicable to them, without prejudice to what is provided in criminal legislation".

IV
That on June 18, 2025, Presidential Decree 09-2025, "For the application of measures in matters of freezing of funds or other assets related to Terrorism, the Proliferation of weapons of mass destruction and their Financing, in accordance with Resolutions of the Security Council of the United Nations," entered into force, published in La Gaceta, Official Gazette, No. 109, of June 18, 2025, which repealed Decree No. 17-2014, "Decree for the application of measures in matters of freezing of funds or assets related to terrorism and its financing in accordance with Resolutions 1267(1999) and 1989 (2011) and successive, Resolution 1988 (2011) and successive and Resolution 1373 (2001) of the Security Council of the Organization of the United Nations," published in La Gaceta, Official Gazette No. 61 of March 31, 2014. V That Article 37 of said Presidential Decree 09-2025, states that supervisors: "...will verify, through monitoring and supervision, that the Obligated Subjects under their supervision and regulation comply, in accordance with what is established in the present Decree, with the obligations to implement the Resolutions of the Security Council of the United Nations against terrorism, the proliferation of weapons of mass destruction and their financing." VI That Article 38 of said Presidential Decree 09-2025, establishes that: "Obligated Subjects that fail to comply with what is established in this Decree, will be subject by their supervisor, to the corresponding administrative sanctions, in accordance with what is provided in their respective legal frameworks." VII That in accordance with Articles 20 to 25 of Executive Decree No. 15-2018, Regulation of Law No. 977, Law Against Money Laundering, Terrorist Financing and Financing of the Proliferation of Weapons of Mass Destruction, approved on November 30, 2023, published in La Gaceta, Official Gazette No. 153 of August 20, 2024 (Decree 15-2018), supervised financial institutions, once they receive the communication of the lists from the Financial Analysis Unit (UAF), will proceed without delay to the search, detection and freezing of funds or other assets that are in their possession, they will also search for records of completed or attempted operations involving the designated persons and organizations, proceeding to inform the UAF confidentially of the positive or negative result of the search. VIII That Article 147 of Law No. 1232, "Law on the Administration of the Monetary and Financial System," published in La Gaceta Official Gazette No. 241, of December 30, 2024, one of the "laws on the matter" of the constitutional article referred to in the consideration I of this resolution, established a new range of fines for "supervised institutions," for violations of the provisions of said Law, related laws and regulations, committed even by "other financial institutions," which will be applied by the Superintendence. IX

That, in accordance with Recommendation No. 6 of the Financial Action Task Force (FATF), regarding "Targeted Financial Sanctions related to terrorism and terrorist financing," countries must implement financial sanction regimes to comply with the Resolutions of the Security Council of the United Nations relating to the prevention and repression of terrorism and the financing of terrorism, which require countries to implement measures and designate authorities that freeze without delay funds or other assets and ensure that no funds or other assets are made available, directly or indirectly, to or for the benefit of, any person or entity either (i) designated by, or under the authority of, the Security Council of the United Nations within Chapter VII of the Charter of the United Nations, including in accordance with Resolution 1267 (1999) and its successor Resolutions; or (ii) designated by the country pursuant to Resolution 1373 (2001). X That in accordance with Recommendation No. 7 of the FATF regarding "Targeted Financial Sanctions related to proliferation," countries must implement targeted financial sanctions to comply with the Resolutions of the Security Council of the United Nations relating to the prevention, repression and interruption of the proliferation of weapons of mass destruction and their financing, including the implementation of measures and the designation of authorities to freeze without delay funds or other assets of, and ensure that no funds or other assets are made available, directly or indirectly, to or for the benefit of, any person or entity designated by or under the authority of the Security Council of the United Nations within Chapter VII of the Charter of the United Nations. XI That, in accordance with the legal provisions stated above, it is necessary to establish a consolidated framework of specific sanctions to be applied to persons supervised by this Superintendence, to sanction the non-compliance with the obligations derived from Decrees No. 09-2025 and 15-2018. In exercise of its powers, RESOLVES TO APPROVE The following:
NORM ON THE IMPOSITION OF SANCTIONS ON SUPERVISED ENTITIES AND OTHER OBLIGATED SUBJECTS FOR NON-COMPLIANCE WITH MEASURES IN MATTER OF FREEZING OF FUNDS OR OTHER ASSETS RELATED TO TERRORISM, THE PROLIFERATION OF WEAPONS OF MASS DESTRUCTION AND THEIR FINANCING, IN ACCORDANCE WITH THE RESOLUTIONS OF THE SECURITY COUNCIL OF THE UNITED NATIONS
CHAPTER I
OBJECT AND SCOPE

Article 1. Object.- This norm aims to establish the types of infractions and the sanctions applicable for the non-compliance with the obligations established in Decrees No. 09-2025 and 15-2018, within the ranges established in Article 164 of Law No. 561, General Law of Banks, Non-Banking Financial Institutions and Financial Groups, as well as in Articles 147 and 148 of Law No. 1232, Law on the Administration of the Monetary and Financial System, determined according to the severity of the offense, in accordance with the parameters and criteria to be indicated in this Norm.
Article 2. Scope.- The provisions of this norm are applicable to banks, financial companies, special regime financial companies, representative offices of banks and foreign financial companies, financial leasing companies, factoring companies, non-bank providers of fiduciary services, both natural and legal persons, savings and credit cooperatives, insurance companies and intermediaries, general warehouses of deposits and entities of the securities market, all subjects to the authorization, regulation, supervision, surveillance and oversight of the Superintendence of Banks and Other Financial Institutions; which for the purposes of this norm are referred to as "the supervised", unless in this norm they are identified specifically for reasons of application of the different modalities of fines.
CHAPTER II
INFRACTIONS AND SANCTIONS
Article 3. Infractions and amounts.- The supervised, without prejudice to the other criminal, civil and administrative responsibilities that may be established in accordance with the applicable laws, will be sanctioned financially by the Superintendent of Banks and Other Financial Institutions, for the infractions that commit to the measures of detection, freezing and immediate and confidential reporting to the Financial Analysis Unit (UAF) of funds or assets related to the persons or entities designated in the Lists that this Unit communicates to them, linked to the application of Decrees No. 09-2025 and 15-2018, in accordance with the following:
a. Ranges

1. The ranges of financial sanctions applicable to banks, financial companies and special regime financial companies, financial leasing companies, factoring companies, non-bank providers (legal person) of fiduciary services, savings and credit cooperatives, insurance companies, general warehouses of deposits and entities of the securities market, in accordance with the lesser or greater gravity of the infractions, will be the following:
   i. Minor infractions: fines between zero with one thousandth percent (0.001%) and zero with one hundred twenty-five thousandths percent (0.125%) of the equity.
   ii. Moderate infractions: fines between zero with one thousand two hundred fifty-one ten-thousandths percent (0.1251%) and zero with twenty-five hundredths percent (0.25%) of the equity.

iii. Grave infractions: fines between zero with two hundred fifty-one thousandths percent (0.251%) and zero with five tenths percent (0.5%) of the equity.
The above percentages will be calculated on the equity registered in the financial statements corresponding to the month of December of the year prior to the application of the fine, reported by the offender to the Superintendence and published by it on its website. In the case of supervised entities that have less than twelve (12) months of operation, the fine will be calculated on the equity registered in the financial statements corresponding to the most recent month, reported by the entity to the Superintendence.
2. The ranges of financial sanctions applicable to the representative offices of banks and foreign financial companies in accordance with the lesser or greater gravity of the infractions will be the following:
i. Minor infractions: fines between zero with one thousandth percent (0.001%) and zero with one hundred twenty-five thousandths percent (0.125%) on the amount of the credit portfolio.
ii. Moderate infractions: fines between zero with one thousand two hundred fifty-one ten-thousandths percent (0.1251%) and zero with twenty-five hundredths percent (0.25%) on the credit portfolio.
iii. Grave infractions: fines between zero with two hundred fifty-one thousandths percent (0.251%) and zero with five tenths percent (0.5%) on the credit portfolio.
The above percentages will be applied on the average balance of the portfolio reported by the representative offices of banks and foreign financial companies in the twelve months preceding the application of the fine. In the case of representative offices of banks and foreign financial companies that have less than twelve months of operation, a fine of between 100 and 1,000 fine units will be imposed. The value of each fine unit will correspond to the national average minimum wage at the date of imposition of the fine, which is the simple average calculated based on the Minimum Wage Table by Sector of Activity that determines the law on the matter.
3. For the case of non-bank providers of fiduciary services natural persons and insurance intermediaries, the following fines will apply:
i. Minor Infractions: between zero with one hundredth (0.01) and ten (10) fine units.
ii. Moderate Infractions: between ten with one hundredth (10.01) and fifty (50) fine units.
iii. Grave Infractions: between fifty with one hundredth (50.01) and one hundred (100) fine units.
The value of each fine unit will correspond to the national average minimum wage at the date of imposition of the fine, which is the simple average calculated based on the Minimum Wage Table by Sector of Activity that determines the law on the matter. b. Infractions

1. Minor infractions:
   i. When the supervised entity carries out the search against its respective databases, and does not detect funds or assets related to the persons or entities designated in the List that they receive from the UAF, and does not communicate to it, without delay, the negative result of its review against its databases.
   ii. When the supervised entity carries out the search against its respective databases, and does not detect funds or assets related to the persons or entities designated in the List that they receive from the UAF, but does not communicate to it the negative result of its review against its databases.
2. Moderate infractions:
   i. When the supervised entity, even though it has, in accordance with the current legal, regulatory and normative provisions, specifically, clearly and identifiably in its "Manual for the Prevention of Money Laundering; Terrorist Financing and Financing of the Proliferation of Weapons of Mass Destruction" (AML/CFT/CPF Manual), with the policies, procedures, measures and monitoring tools, the controls and specific internal communication channels and process flow diagrams to comply with the provisions of Decrees 09-2025 and 15-2018 regarding the obligated subjects, is not applying them adequately; or that the existing ones are inadequate.
   ii. When the supervised entity, in accordance with current normative provisions or its own policies, at the time of establishing a new commercial relationship or continuing the existing one or providing a new product or service, has not carried out direct monitoring of its clients, occasional users or the entirety of its database against the updated lists available on the official website of the United Nations Security Council.
   iii. When the supervised entity detects in its respective databases, funds or assets related to the persons or entities designated in the List that they receive from the UAF, but does not communicate to it without delay, immediately and without delay, the execution or application of the preventive freezing measure.
   iv. When the supervised entity, in the cases where it is required by the applicable legal framework, cannot evidence that its Internal Audit, has audited at least once a year, specifically, the policies, procedures, measures, monitoring tools, controls, specific internal communication channels and process flow diagrams that the entity must have established and clearly identified within its AML/CFT/CPF Manual, to comply with the application of the provisions of Decrees 09-2025 and 15-2018 regarding this entity in its capacity as an obligated subject by Law, or that its Internal Audit has not

pronounced itself in its respective reports, on the sufficiency and effectiveness of the same to comply with said Decree.
v. When the supervised entity detects in its respective databases, funds or assets related to the persons or entities designated in the List that the UAF communicates to it and carries out its preventive freezing, but does not evidence having communicated it to said Unit.
vi. When the UAF, based on its legal powers, informs the Superintendent, that the supervised entity responded outside the established deadline the results of its search of the lists received from this Unit related to Decree 09-2025.
3. Grave infractions:
i. For not having specifically, clearly and identifiably in its "Manual for the Prevention of Money Laundering, Terrorist Financing and Financing of the Proliferation of Weapons of Mass Destruction" (AML/CFT/CPF Manual), with the policies, procedures, measures and monitoring tools, the controls and specific internal communication channels and process flow diagrams to comply with the provisions of Decrees 09-2025 and 15-2018, regarding the obligated subjects.
ii. When the supervised entity, having received the List from the UAF on designated persons or entities, does not carry out the search in its respective databases, a situation that has been detected by the Superintendence or notified by the UAF based on its powers.
iii. When the UAF, based on its legal powers, informs the Superintendent that the supervised entity did not respond regarding the results of its search of the lists received from this Unit related to Decree 09-2025.
iv. When the supervised entity carries out the searches against its respective databases and detects funds or assets related to the persons or entities designated in the list that it has received from the UAF, but does not evidence having carried out the preventive freezing of the same.
v. When the supervised entity detects, in its respective databases, funds or assets related to the persons or entities designated in the List that they receive from the UAF, but does not carry out without delay, immediately and without delay the preventive freezing of the same.
vi. When the supervised entity revokes or modifies the freezing measure of the funds or assets that it had previously notified to the UAF, without having been previously authorized and officially notified by the competent judicial authority.
vii. When the supervised entity, as a result of its own monitoring, scrutiny and enhanced due diligence measures that it applies, making use of the results of the known information of its clients from the checks against its databases of the lists that the UAF communicated to it, does not present in accordance with the results of its internal scrutiny and analysis, the Suspicious Transaction Report (STR) of Terrorist Financing and/or Proliferation, as appropriate, in the form, deadlines and mechanisms established in accordance with what is provided in the law, regulation and normative of the matter currently issued by the competent authority.
Article 4. Infractions and applicable amount to whoever reveals information on suspicious transaction report (STR).- It will commit a grave offense, the Director, Representative, Manager, Executive, Official, AML/CFT/CPF Risk Prevention Administrator, Internal Auditor or any other employee of the institution, who discloses or informs the client that their transaction is being analyzed or considered for a possible STR of terrorist financing and/or proliferation, or, who informs them that such report will be or has been filed. The Superintendent will impose, without prejudice to criminal sanctions, a fine from two to six monthly salaries of these. In the case that the above infraction is committed by shareholders of the supervised entity, without prejudice to the corresponding criminal sanctions, the fine will be from fifty to two hundred fine units. The value of each fine unit will correspond to the national average minimum wage at the date of imposition of the fine, which is the simple average calculated based on the Minimum Wage Table by Sector of Activity that determines the law on the matter.
In the case that the official referred to above is from an insurance company, general warehouse of deposits or entity of the securities market, the Superintendent will impose, without prejudice to criminal sanctions, a fine between fifty with one hundredth (50.01) and one hundred (100) fine units.
Article 5. Other infractions.- It will commit a grave offense, the Director, Representative, Manager, Executive, Official, AML/CFT/CPF Risk Prevention Administrator, Internal Auditor or any other employee of the supervised entity, who alter or disfigure data or background in the balances, books, statements, accounts, correspondence or any other document or who hide or prevent them from being known or destroy these elements, with the aim of hindering, diverting or evading the oversight, supervision or inspection that corresponds to be exercised by the Superintendence in accordance with the Law. The Superintendent will impose, without prejudice to the corresponding criminal sanctions, a fine from two times their monthly salary to six times their monthly salary. For the case of directors, the sanction will be from fifty to two hundred fine units. The value of each fine unit will correspond to the national average minimum wage at the date of imposition of the fine, which is the simple average calculated based on the Minimum Wage Table by Sector of Activity that determines the law on the matter.
In the case that the official referred to above is from an insurance company, general warehouse of deposits or entity of the securities market, the Superintendent will impose, without prejudice to criminal sanctions, a fine between fifty with one hundredth (50.01) and one hundred (100) fine units.
Article 6. Other sanctions.- In accordance with the power granted by Article 164 of Law No. 561, the Superintendent, separately or together with the financial sanctions for the infractions committed to the legal and normative framework against AML/CFT/CPF, may apply one or more of the range of sanctions following: temporary suspension of certain or all operations affected by the deficiencies of the AML/CFT/CPF prevention program,

until the cancellation of the authorization granted, action plans for the p