Financial Crime World

Andorra Steps Up Efforts to Combat Money Laundering and Terrorist Financing, But Room for Improvement Remains

A recent report published by MONEYVAL, the Council of Europe’s anti-money laundering (AML) and counter-terrorism financing (CFT) body, has given Andorra a mixed assessment on its efforts to combat money laundering and terrorist financing. While the country has made significant strides in strengthening its AML/CFT framework, MONEYVAL has called for further improvements.

Key Findings

  • Andorran authorities have demonstrated a comprehensive understanding of the risks associated with money laundering and terrorist financing.
  • The Unitat d’Intelligència Financera d’Andorra (UIFA) has been commended for providing financial intelligence that supports investigations into money laundering cases.
  • However, MONEYVAL has expressed concern over the modest ratio of investigations to prosecutions and convictions obtained.

Challenges and Recommendations

Political Oversight

  • MONEYVAL emphasizes the need for clear political oversight to ensure the effective implementation of action plans aimed at mitigating risks associated with money laundering and terrorist financing.

Financial Intelligence Unit

  • The report highlights that the limited resources allocated to Andorra’s financial intelligence unit have hindered its ability to effectively supervise the country’s financial sector.
  • MONEYVAL stresses the need for enhanced strategic engagement and coordination between the UIFA and other supervisory authorities.
  • Andorra has established a robust legal framework to criminalize terrorist financing, with a corresponding absence of prosecutions in line with its risk profile.
  • However, larger financial institutions appear to have a better grasp of their AML/CFT risks compared to smaller ones, such as lawyers and accountants.
  • The report notes that Andorra has made proactive efforts in seeking and providing legal assistance to foreign jurisdictions.
  • MONEYVAL has recommended the removal of dual criminality as a requirement for rendering mutual legal assistance.

Conclusion

While Andorra has made significant progress in strengthening its AML/CFT framework, there is still room for improvement. As the country continues to work towards further enhancing its efforts, MONEYVAL’s recommendations will play a crucial role in guiding this process.