Title: Bhutan Cracks Down on Financial Crimes: Insights from the 2023 Report
Introduction
Bhutan, known as the “Land of the Thunder Dragon,” is celebrated for its tranquility and unique cultural heritage. However, like many nations, Bhutan grapples with the challenge of combating financial crimes, primarily focusing on money laundering and terrorist financing. In this article, we explore the crucial findings of Bhutan’s 2023 financial crime report, issued by the Financial Intelligence Unit of Bhutan (FIU-Bhutan).
Key Areas of Focus in the Report
The report consists of several sections, which are discussed below:
- Risk Assessment and Application of a Risk-based Approach (R.1)
- National Cooperation and Coordination (R.2)
- Money Laundering Offenses (R.3)
- Terrorist Financing Offenses (R.5)
- Sanctions related to Terrorism and Terrorist Financing (R.6 and R.7)
- Regulatory Framework Regarding Non-Profit Organizations (R.8)
- Securing Financial Institution Secrecy Laws (R.9)
- Customer Due Diligence (R.10)
- Record Keeping (R.11)
- Politically Exposed Persons (PEPs) (R.12)
- Correspondent Banking (R.13)
- Virtual Currencies and Digital Assets (R.15)
- International Cooperation (R.37 and R.39)
Bhutan’s Progress in Recent Years
Risk Assessment and Risk-Based Approach (R.1)
Bhutan has made remarkable progress in recent years, focusing on strengthening financial institutions and regulatory frameworks to mitigate financial crime risks.
National Cooperation and Coordination (R.2)
Collaboration between essential agencies, including the Central Bank of Bhutan and the Royal Bhutan Police, has been crucial in combating financial crimes.
Specific Measures Taken to Counteract Financial Crimes
Money Laundering Offenses and Terrorist Financing Offenses (R.3 and R.5)
Bhutan’s commitment to implementing United Nations Security Council resolutions and international standards to tackle money laundering and terrorist financing is evident.
Targeted Financial Sanctions (R.6 and R.7)
Establishment of targeted financial sanctions related to terrorism and terrorist financing is a significant move by the Bhutanese government.
Regulatory Frameworks (R.8, R.9)
There have been substantial improvements in regulating non-profit organizations and securing financial institution secrecy laws.
Customer Due Diligence and Record Keeping (R.10 and R.11)
Bhutan has made strides in enhancing awareness of customer due diligence practices and record keeping.
Politically Exposed Persons and Correspondent Banking (R.12 and R.13)
Addressing the risks associated with managing politically exposed persons and implementing effective anti-money laundering measures for correspondent banking relationships are crucial.
Virtual Currencies and Digital Assets (R.15)
The FIU-Bhutan is working closely with financial institutions to manage risks associated with new technologies like virtual currencies and digital assets.
Importance of International Cooperation
The report underscores the significance of international cooperation, including mutual legal assistance and extradition, in addressing cross-border money laundering and terrorist financing cases.
Conclusion
Bhutan’s financial crime report showcases the country’s focused efforts to combat money laundering and terrorist financing. By improving risk assessment, strengthening regulatory frameworks, and promoting national and international cooperation, Bhutan is making essential strides in preserving its financial system’s integrity.