Financial Crime World

Andorra: MONEYVAL’s 2nd Enhanced Follow-up Report on Anti-Money Laundering/Countering Financing of Terrorism (AML/CFT) Policies (December 2019)

MONEYVAL, the European anti-money laundering and countering the financing of terrorism (AML/CFT) body, adopted Andorra’s 2nd Enhanced Follow-up Report during its 59th Plenary Session in Strasbourg.

Andorra’s Progress

The report evaluates Andorra’s progress in addressing the technical compliance deficiencies identified in its initial Mutual Evaluation Report (MER) and in implementing new requirements relating to the Financial Action Task Force (FATF) Recommendations which have changed since the 1st enhanced follow-up report was published.

Technical Compliance Deficiencies

Andorra made considerable progress in addressing the technical compliance deficiencies identified in the MER.

  • Recommendation 25, 26, and 28: Andorra achieved re-ratings in these recommendations due to their significant progress.
  • Recommendation 8: Andorra undertook measures to enhance transparency and integrity within non-profit organizations (NPOs):
    • Strengthening requirements for associations, foundations, and other NPOs.
    • Requiring boards of directors to prevent NPOs from facilitating terrorism financing.
    • Keeping records of all persons receiving funds from NPOs.
    • Amending laws to require associations and foundations to establish registers of members, beneficial owners, minutes books, inventories, and accounting books.

Despite this progress, some deficiencies persist:

  • Recommendation 8: The rating remains “partially compliant” due to unresolved issues.

Recommendation 25

  • Initial Rating: Partially Compliant (PC)
  • Re-Rated: Large Compliance (LC)

Andorra made progress in addressing issues relating to client secrecy, trustees’ obligations to declare their status to a financial institution, and providing authorities with access to the Register of Trust Service Providers and Similar Legal Instruments.

Areas That Require Further Attention

Despite the progress made, there are still deficiencies that need addressing:

Recommendation 8

  • C.8.1: Andorra is in the process of amending its AML/CFT Law to apply the requirements of c. 22.1 (e) to fully address the issue.

Recommendation 25

  • C.25.1: Andorra is amending its AML/CFT Law to apply requirements to settlors, protectors, and beneficiaries.
  • C.25.3: Andorra is addressing the definition of trust service providers and trusts in Article 3(4) of the AML/CFT Law to ensure the requirement of trustees declaring their status to financial institutions or other designating non-financial business and professional persons (DNFBPs) is effectively implemented.

Conclusion

The 2nd Enhanced Follow-up Report on Andorra’s AML/CFT policies highlights the country’s progress and identifies areas that require further attention to meet international standards fully. Efforts are underway to address these remaining deficiencies and improve the overall effectiveness of Andorra’s AML/CFT framework.