Financial Crime World

Andorra’s AML/CFT/Regulations: A Mixed Bag of Compliance, says FATF Report

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The Financial Action Task Force (FATF) has released its Follow-up Report on Andorra, assessing the country’s implementation of anti-money laundering (AML), combating the financing of terrorism (CFT), and regulatory requirements. While Andorra has made progress in some areas, it still faces challenges in others.

Assessment Results

According to the report, Andorra is:

  • Compliant with 14 out of 40 recommendations
  • Largely Compliant with 22 recommendations
  • Partially Compliant with 3 recommendations
  • Non-Compliant with 1 recommendation

Areas of Compliance

The report highlights the following areas where Andorra is compliant:

Risk Assessment and Application of a Risk-Based Approach (R.1)

Compliant

National Cooperation and Coordination (R.2)

Compliant

Money Laundering Offence (R.3)

Largely Compliant

Confiscation and Provisional Measures (R.4)

Compliant

Terrorist Financing Offence (R.5)

Largely Compliant

Areas of Concern

However, Andorra faces challenges in other areas, including:

Partially Compliant

Regulation and Supervision of Financial Institutions (R.26) and Powers of Supervisors (R.27)

Needs Improvement

Mixed Performance

Andorra’s performance in other areas is mixed, with some recommendations being:

  • Largely Compliant:
    • Customer Due Diligence (R.10)
    • Record Keeping (R.11)
    • Internal Controls and Foreign Branches and Subsidiaries (R.18)
  • Non-Compliant:
    • Mutual Legal Assistance: Freezing and Confiscation (R.38)

Recommendations for Improvement

The FATF report highlights several areas where Andorra needs improvement, including:

Strengthening the Financial Intelligence Unit

Improving Regulation and Supervision of Designated Non-Financial Businesses and Professions

Conclusion

While Andorra has made progress in implementing AML/CFT regulations, it still faces challenges in several areas. The country must continue to strengthen its efforts to ensure effective implementation of these regulations and prevent financial crime.