Brunei’s Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) Regime: Areas of Improvement

Key Findings

Capacity Building Issues

• Brunei’s Financial Intelligence Unit (FIU) lacks the necessary resources to effectively analyze Suspicious Transaction Reports (STRs) and provide useful disseminations to law enforcement.
  • Staffing
  • Database systems
  • Access to information
• The agencies designated to investigate money laundering (ML) and terrorist financing (TF) have not yet undertaken ML/TF investigations, despite having the necessary powers.

Implementation Challenges

• Investigative and prosecution agencies have not effectively pursued ML and TF cases, even with key tools available.
• AML/CFT preventive obligations are only lightly addressed in Brunei’s Money Laundering Order (MLO), and draft guidelines have not been issued as binding instructions to financial institutions.

Recommendations

Strengthening the FIU

• Provide adequate resources to enable the FIU to effectively analyze STRs.
  • Staffing
  • Database systems
  • Access to information

Improving Investigations

• Mobilize efforts to investigate and prosecute ML and TF cases, and establish a clearer policy on prosecution.

Issuing Binding Instructions

• Expedite the issuance of draft Know Your Customer/Customer Due Diligence (KYC/CDD) guidelines as binding instructions for financial institutions.

Conclusion

Brunei’s AML/CFT regime needs significant improvements to effectively prevent and investigate ML and TF cases. The assessors’ recommendations provide a roadmap for strengthening the country’s AML/CFT framework.