Financial Crime World

Bangladesh Takes Steps to Enhance International Cooperation on Financial Crimes

A recent assessment by the global watchdog Financial Action Task Force (FATF) has highlighted Bangladesh’s efforts to strengthen its measures against financial crimes, including money laundering and terrorist financing. The evaluation, which focused on Bangladesh’s implementation of FATF recommendations, revealed significant progress in several areas.

Progress in Key Areas

Regulation and Supervision of Financial Institutions

One key area where Bangladesh scored high was in the regulation and supervision of financial institutions (R.26). The country has made notable improvements in this regard, with the central bank implementing effective oversight mechanisms to prevent illicit activities.

  • Effective implementation of oversight mechanisms by the central bank
  • Stronger regulations to prevent illicit activities

Transparency and Beneficial Ownership

Bangladesh demonstrated a strong commitment to transparency and beneficial ownership of legal persons and arrangements (R.24), with ongoing efforts to enhance its corporate registry system.

  • Ongoing efforts to enhance the corporate registry system
  • Improved transparency in beneficial ownership

Measures Against Terrorist Financing and Money Laundering

In addition, Bangladesh has shown significant progress in implementing measures against terrorist financing (R.5) and money laundering (R.3). The country has strengthened its laws and regulations to combat these crimes, including the establishment of a specialized unit within the central bank to monitor suspicious transactions.

  • Strengthened laws and regulations
  • Establishment of a specialized unit to monitor suspicious transactions

Areas for Improvement

However, some areas require further attention. For instance:

Customer Due Diligence for Financial Institutions

While Bangladesh has made efforts to enhance customer due diligence for financial institutions (R.10), there is still room for improvement in this regard.

  • Room for improvement in enhancing customer due diligence

Internal Controls and Foreign Branches and Subsidiaries

The country needs to strengthen its internal controls and foreign branches and subsidiaries (R.18) to prevent illicit activities.

  • Need for stronger internal controls
  • Strengthening of foreign branches and subsidiaries

International Cooperation

The assessment also highlighted the importance of international cooperation in combating financial crimes. Bangladesh has made significant strides in this area, with notable improvements in mutual legal assistance (R.37), extradition (R.39), and other forms of international cooperation (R.40).

  • Notable improvements in mutual legal assistance
  • Enhanced extradition agreements
  • Increased international cooperation

Recommendations

Bangladesh should continue to build on its progress in several key areas, including:

  • Enhancing customer due diligence for financial institutions
  • Strengthening internal controls and foreign branches and subsidiaries
  • Improving transparency and beneficial ownership of legal persons and arrangements

Furthermore, Bangladesh should prioritize international cooperation by:

  • Enhancing mutual legal assistance and extradition agreements with other countries
  • Expanding its network of bilateral agreements on combating financial crimes
  • Collaborating with regional and global organizations to share best practices and intelligence on illicit activities.