Financial Crime World

Macao’s Risk-Based Approach to AML/CFT Yields Outstanding Results

Macao has achieved outstanding results in its recent Asia/Pacific Group on Money Laundering (APG) Mutual Evaluation, marking a significant milestone in its efforts to combat money laundering and terrorist financing.

Effective Risk-Based Supervision

According to the evaluation report, Macao’s risk-based approach to anti-money laundering (AML) and combating the financing of terrorism (CFT) has been effective in mitigating the risks associated with the use of financial systems for criminal activities. The report praised Macao’s strong supervisory framework, which includes:

  • A robust licensing regime
  • Regular on-site and off-site supervision
  • Thematic assessments

Key Areas of Excellence

The evaluation highlighted several key areas where Macao excelled, including:

Risk-Based Supervision of the Gaming Sector

  • Stringent measures to prevent money laundering and terrorist financing in this sector
    • Double-scrutiny system for junket promoters
    • Mandatory reporting system for large-transaction transactions

Financial and Insurance Sectors

  • Effective implementation of AML/CFT guidelines, incorporating FATF recommendations and methodology
  • Robust licensing regime ensuring new entrants comply with international standards

Comprehensive Supervision of DNFBPs

  • Real estate intermediaries and agents
  • Dealers of precious metals and stones
  • Pawn shops
  • Car dealers
  • Notaries and professionals such as accountants, auditors, and lawyers

Long-Term Oriented Strategy

The report noted that Macao’s AML/CFT strategy is long-term-oriented, prioritizing prevention over prosecution. The government has:

  • Allocated top resources to strengthen the supervisory framework
  • Progressively enhanced the capacity of law enforcement agencies in financial investigation

Commitment to Continuous Improvement

In response to the evaluation report, the Macao SAR Government has committed to addressing the deficiencies pointed out and will implement follow-up actions accordingly. This demonstrates the government’s commitment to continuous improvement and its determination to protect financial stability by preventing criminal activities.

Conclusion

The successful implementation of Macao’s risk-based approach to AML/CFT is a testament to the government’s efforts to combat money laundering and terrorist financing, and it serves as an example for other jurisdictions to follow.