FATF: Eight Asian nations on the watch-list – four more still pose risks

At its Paris plenary meeting last week, the Financial Action Task Force produced a revised list of countries under observation for FCA - FATF Logocompliance with the 40 Recommendations on anti-money laundering and counter-terrorism financing. A group of eight Asian jurisdictions are on the list of 24. Four more (4/11) take up spaces on the less friendly “black-list” of nations whose lack of AML/CTF regimes have strategic deficiencies and pose a threat to the international financial system.

Starting with the worst offender, North Korea – or the Democratic Peoples Republic of Korea – is facing counter-measures from the FATF and FATF member countries for failing to address the ongoing risks to the international financial system. Indonesia, Myanmar and Pakistan have not yet implemented a strategy to tackle AML/CTF legal deficiencies and the FATF advises its member countries to evaluate the risks of each jurisdiction vis a vis transactions and business.

In total 24 Asian countries have planned legal frameworks in terms of AML/CTF but have yet to implement them, a group which are almost ready to jump off the list altogether. Nepal, whose lawmakers pushed media interest towards their planned implementation of an Anti-money Laundering Ordinance last week, has remained this section of the watch-list along with Kyrgyzstan, Lao PDR, Mongolia, Papua New Guinea and Tajikistan.

Afghanistan and Cambodia, both in the throws of post-conflict resolution, civil unrest and poverty, were identified in the first circle of FATF hell as not having making sufficient progress. The FATF and Asia Pacific Group on Money Laundering listed several areas of work required in both countries which will aid their elevation from the watch-list, despite their publicised “high-level” commitments to battling financial crime which have not yet resulted in practical changes to the law.

Two Asian nations have made “significant progress” in their work to improve AML/CTF regimes and implement legal frameworks which are robust enough to meet the international standard setter’s requirements. Bangladesh and Vietnam are no longer in the bad books and no longer subject to the FATF’s monitoring process. Both jurisdictions, however, will continues to work closely with the Asia Pacific Group on Money Laundering to improve AML/CTF regimes.

For the full reports from the  FATF – click here


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