Now the 'Witch Hunt' Begins: Chalyan on the Bank Secrecy Legislation

Co-founder of the "National Agenda" party, Avetik Chalyan, addressed the proposed amendments to the "Bank Secrecy Law" on his Facebook page, stating: "On September 12, the Government approved a draft law on key changes to the Law on Bank Secrecy and the Criminal Procedure Code of the Republic of Armenia after an unusually heated discussion.

Under current legislation, bank secrecy can only be breached by court order for individuals involved as accused or suspected in a criminal case, which is a widely accepted international practice. The proposed amendment would allow for the breach of bank secrecy by court order against any person whom investigative authorities might suspect of potentially being involved in a case, potentially affecting dozens of people based on an investigator's 'reasonable' suspicion.

While this may not seem significant at first glance, the adoption of such a law poses serious dangers for our banking system. Worldwide, people keep their money in banks under the assumption of strict confidentiality; otherwise, they risk becoming targets of organized crime, extortionists, tabloid journalism, and even state security agencies in authoritarian regimes. Given that a 'witch hunt' is already underway in our country, this could easily become a tool for pressure against arbitrarily defined 'undesirable' individuals.

If this law is enacted in Armenia, not only will the rights of many law-abiding citizens—guaranteed by current law—be violated as their bank secrecy becomes accessible to the state arbitrarily, but it will also compel many to move their finances as far as possible from Armenian banks or cease investing in them altogether. Despite all their shortcomings, our banks are among the most developed systems operating in the country; they jointly ensure financial stability, create a significant number of high-paying jobs, and their accumulated deposits (including from abroad) increase year by year, while the value of these funds for operators decreases.

All of this is now at risk; if people and companies, wary of arbitrary actions by law enforcement, start withdrawing their assets from Armenian banks and relocating them abroad (which is very easy to do today), or liquidating them, it could all become a reality. In that case, the development of our banking system could fall back decades, and each of us will feel the consequences through higher interest rates, currency instability, loss of deposits, and other currently unseen negative outcomes.

Yesterday, there was an unusually heated discussion in the Government regarding this issue, and knowledgeable individuals pointed out the dangers of this legislative change several times. Despite this, Prime Minister Pashinyan, in his characteristic arbitrary style, 'sidestepped' all arguments and pushed the draft law, which is now set to be presented to the National Assembly for consideration. In the increasingly complicated internal situation in Armenia, this will become yet another meaningless source of controversy and tension. One can only hope that either the National Assembly will reject this draft or the Government will withdraw it; otherwise, future authorities will be forced to repeal this law after it has done its dirty work and caused irreversible damage to our financial system, thus affecting each one of us."