AG Issues Proceeds Of Crime Advisory

July 10, 2011

Attorney General and Minister of Justice Michael Scott issued an advisory about the risks in a number of jurisdictions arising from inadequate systems and controls to combat money laundering and terrorist financing.

Details on these risks were provided by the Financial Action Task Force [the FATF] in statements which were released following its Plenary held in June, 2011. The Minister noted that the advice is especially relevant to those entities that have or are considering any business relationships with the specified jurisdictions or persons [individuals or corporate entities] in such jurisdictions.

The Proceeds of Crime [Anti-Money Laundering and Anti-Terrorist Financing] Regulations 2008 [the Regulations] require AML/ATF regulated financial institutions to have policies, procedures or systems in place to prevent money laundering or terrorist financing. Under the Regulations, relevant persons are also required, under certain specified situations and also in those situations which are deemed to present a higher risk of money laundering or terrorist financing, to apply enhanced customer due diligence measures and/or ongoing monitoring on a risk-sensitive basis.

Advisory Below:

On 27th June 2011, the FATF issued a public statement drawing attention to serious deficiencies in Iran and the Democratic People’s Republic of Korea [DPRK]. Both countries were identified in previous FATF public statements but continue to raise concerns for the FATF by their continued failure to address ongoing and substantial deficiencies in their anti-money laundering and combating the financing of terrorism [AML/CFT] regime.

The FATF therefore reaffirmed its call on its members to apply counter-measures against each jurisdiction.

In addition, the FATF drew attention in the public statement to a separate list of countries with strategic AML/CFT deficiencies that have not yet demonstrated satisfactory and sufficient progress in addressing the deficiencies, or have not committed to implementing their FATF agreed action plans.

Those jurisdictions include: Bolivia, Cuba, Ethiopia, Kenya, Myanmar, Sri Lanka, Syria, and Turkey. The FATF calls on its members to consider the risks arising from the deficiencies associated with each jurisdiction.

In a separate publication on the ongoing process to improve global AML/CFT compliance, the FATF drew attention to a number of jurisdictions with strategic deficiencies in their AML/CFT regimes. These jurisdictions were previously identified by the FATF and were working with the FATF and relevant regional bodies in order to address those deficiencies. However the FATF now calls for the expeditious implementation of their agreed action plans.

The countries listed are: Angola, Antigua and Barbuda, Argentina, Bangladesh, Brunei Darussalam, Cambodia, Ecuador, Ghana, Honduras, Indonesia, Mongolia, Morocco, Namibia, Nepal, Nicaragua, Nigeria, Pakistan, Paraguay, Philippines, Sudan, Tajikistan, Tanzania, Thailand, Trinidad and Tobago, Turkmenistan, Ukraine, Venezuela, Vietnam, Yemen, and Zimbabwe.

In addition, São Tomé and Príncipe was identified separately, as not making sufficient progress on its FATF agreed action plan. This jurisdiction was urged to take sufficient action to implement significant components of its action plan by October 2011, and was warned that failure to do so will result in the FATF taking further action regarding the risks arising from the deficiencies associated with this jurisdiction.

Finally, the FATF welcomed the significant progress of Greece in improving its AML/CFT regime and Greece is therefore no longer subject to monitoring under the FATF’s ongoing global AML/CFT compliance process.

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