Financial Crime World

Bangladesh Under Scrutiny for Banking Regulations on Financial Crimes

A recent assessment by the Financial Action Task Force (FATF) has revealed that Bangladesh’s banking regulations are lacking in several areas, particularly when it comes to combating financial crimes. The country received ratings of “partially compliant” or “largely compliant” in most of the 40 criteria evaluated by the FATF.

Key Findings

The report highlighted a number of concerns, including inadequate measures to assess and mitigate risks related to money laundering and terrorist financing. Bangladesh also scored poorly on customer due diligence, record keeping, and transparency and beneficial ownership of legal persons.

Areas for Improvement

The FATF assessment highlighted a number of areas where Bangladesh needs to improve its banking regulations, including:

  • Strengthening Customer Due Diligence and Record Keeping Requirements
    • Enhance requirements for customer due diligence to identify and mitigate risks related to money laundering and terrorist financing.
    • Improve record keeping requirements to detect and prevent suspicious transactions.
  • Enhancing Transparency and Beneficial Ownership Requirements
    • Implement more stringent regulations on transparency and beneficial ownership of legal persons.
    • Ensure that financial institutions can effectively identify and disrupt money laundering activities.
  • Improving Regulation and Supervision of Financial Institutions
    • Strengthen the powers of supervisors to ensure effective regulation and supervision of financial institutions.
    • Enhance the effectiveness of the financial intelligence unit to identify and disrupt money laundering activities.
  • Enhancing the Effectiveness of the Financial Intelligence Unit
    • Improve the functioning of the financial intelligence unit to effectively identify and disrupt money laundering activities.

Progress Made

The report noted that Bangladesh had made some progress in recent years, but more work was needed to bring its banking regulations into line with international standards. The country has committed to implementing the recommendations outlined in the report and will be subject to regular monitoring by the FATF.

Next Steps

Bangladesh has committed to:

  • Implementing the recommendations outlined in the report
  • Enhancing its banking regulations to meet international standards
  • Improving its ability to detect and prevent financial crimes

This will require significant effort and resources, but it is essential for Bangladesh to meet its international obligations and protect its financial system from abuse.