Bosnia and Herzegovina Improves Anti-Money Laundering Efforts
Introduction
SARAJEVO, Bosnia and Herzegovina - In its latest report on anti-money laundering (AML) efforts in Bosnia and Herzegovina, the country has been found to be largely compliant with international standards. However, there are still areas that require improvement.
The report by the Financial Action Task Force (FATF), an intergovernmental body responsible for setting global AML standards, assessed Bosnia and Herzegovina’s compliance with 40 key recommendations aimed at preventing money laundering and terrorist financing. While the country has made significant progress in implementing these requirements, it still faces challenges.
Technical Requirements
In terms of technical requirements, Bosnia and Herzegovina has implemented most of the measures recommended by FATF. The country has a robust system for assessing risk and applying a risk-based approach to AML/CFT (Combating the Financing of Terrorism) efforts, with national cooperation and coordination among agencies. However, there are areas where improvement is needed.
Areas of Improvement
Some specific areas that require improvement include:
- Confiscation and provisional measures: The country’s laws and regulations are not yet fully aligned with international standards.
- Terrorist financing offence: Bosnia and Herzegovina has not fully implemented the necessary measures to prevent terrorist financing.
- Financial institution secrecy laws: While the country has taken steps to improve transparency, there is still a need for further reform.
Partially Compliant Areas
Bosnia and Herzegovina was found to be partially compliant in several key areas:
Confiscation and Provisional Measures
The country’s laws and regulations are not yet fully aligned with international standards. This includes the lack of clear procedures for confiscating assets, as well as insufficient penalties for non-compliance.
Terrorist Financing Offence
Bosnia and Herzegovina has not fully implemented the necessary measures to prevent terrorist financing. This includes failing to establish a clear definition of terrorist financing and inadequate procedures for reporting suspicious transactions.
Financial Institution Secrecy Laws
While the country has taken steps to improve transparency, there is still a need for further reform. This includes strengthening customer due diligence requirements and improving access to beneficial ownership information.
Non-Compliant Areas
Bosnia and Herzegovina was also found to be non-compliant in several areas:
Non-Profit Organisations
The country’s laws and regulations do not provide sufficient oversight of non-profit organizations. This includes a lack of clear guidelines for registration, as well as inadequate reporting requirements.
Transparency and Beneficial Ownership of Legal Persons
Bosnia and Herzegovina has not implemented adequate measures to ensure transparency and accountability in the beneficial ownership of legal persons. This includes failing to establish a public registry of beneficial owners and insufficient penalties for non-compliance.
Recommendations
To address these shortcomings, FATF recommends that Bosnia and Herzegovina:
- Enhance its risk assessment and mitigation strategies
- Improve its laws and regulations on confiscation and provisional measures
- Strengthen its efforts to prevent terrorist financing
- Reform its financial institution secrecy laws
- Implement adequate measures to ensure transparency and accountability in the beneficial ownership of legal persons
By addressing these areas, Bosnia and Herzegovina can further improve its AML/CFT regime and enhance its reputation as a responsible member of the international community.
Conclusion
Bosnia and Herzegovina’s efforts to improve its anti-money laundering regime are commendable. However, there is still work to be done to address the remaining areas of non-compliance. By implementing the recommended measures, Bosnia and Herzegovina can enhance its reputation as a responsible member of the international community and further improve its AML/CFT regime.