Financial Crime World

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Belarus’ Financial Sector Remains Largely Underdeveloped

MINSK - The financial sector in Belarus remains largely underdeveloped, with a small number of insurance companies and securities firms operating in the country. According to security authorities, no significant illegal transfer activity has taken place.

Insurance Sector

The insurance sector is dominated by Belgosstrakh, a government-owned company that accounts for approximately 60% of the industry’s activity. Life insurance is not well developed, with only six companies offering limited products. General insurance is also underdeveloped, with mandatory coverage accounting for a large share of the business.

Securities Sector

In the securities sector, there are 131 licensed firms operating in the country, although many are dormant. The market is dominated by transactions in government securities and NBRB securities, with banks playing a significant role in trading these securities.

Designated Non-Financial Businesses and Professions (DNFBPs)

The most important DNFBPs in Belarus include:

  • Lawyers
  • Notaries
  • Auditors
  • Real estate agents
  • Casinos

These professionals are governed by specific legislation and regulation, although only notaries and casinos are currently subject to anti-money laundering (AML) laws.

Commercial Laws and Mechanisms

The country’s commercial laws and mechanisms governing legal persons and arrangements are also underdeveloped. Legal entities can be organized as commercial or non-commercial organizations, but non-commercial organizations may perform business activities subject to their statutes and purposes.

AML/CFT Strategies and Priorities

Belarus has drafted a revised AML law in line with the 2003 FATF Recommendations. However, the current AML/CFT arrangements are only partially effective, and the authorities have signaled an intention to address deficiencies.

The AML Law requires financial institutions and certain DNFBPs to take preventive measures, including:

  • Recording and reporting of financial operations
  • Customer identification
  • Retention of records
  • Development of internal policies and controls

Oversight of these measures falls to several agencies, including:

  • State Control Committee
  • Ministry of Taxation and Duties
  • Primary functional regulators

Conclusion

Despite efforts to comply with international standards, Belarus’ financial sector remains largely underdeveloped, highlighting the need for further reforms and strengthening of AML/CFT measures.