Bulgaria Placed Under Increased Surveillance by Financial Action Task Force (FATF)
============================================================
The Financial Action Task Force (FATF) has placed Bulgaria under enhanced surveillance, citing strategic deficiencies in the country’s anti-money laundering and combating the financing of terrorism (AML/CFT) regime. This move is expected to increase scrutiny on non-profit legal entities (NPOs) registered in Bulgaria.
New Obligations for NPOs
As a result of the FATF’s decision, NPOs will be required to:
- Identify and keep records of their beneficial owners for five years after dissolution
- Include detailed data on the rights held by these individuals
The Bulgarian Center for Non-Profit Law (BCNL) has expressed concerns that the current legislation does not follow a risk-based approach in identifying which NPOs are most vulnerable to terrorist financing abuse. The organization is advocating for changes to ensure that only high-risk NPOs are subject to additional scrutiny.
FATF’s Enhanced Surveillance Plan
The FATF’s plan for dealing with Bulgaria includes measures aimed at preventing the abuse of non-profit organizations for terrorist financing purposes. Specifically, the plan calls for:
- Identifying the subset of NGOs most vulnerable to such abuse
- Demonstrating initial implementation of risk-based monitoring
The BCNL has welcomed this approach and will continue its advocacy work to ensure that only high-risk NPOs are subject to enhanced scrutiny.
Impact on NGOs
The increased surveillance is likely to have significant implications for NGOs operating in Bulgaria. With the FATF’s heightened focus on terrorist financing risks, NGOs may face:
- Additional regulatory requirements
- Scrutiny and monitoring
As the Bulgarian government works to address the deficiencies identified by the FATF, NGOs will need to be prepared to adapt to changing regulations and ensure compliance with new standards.
Conclusion
The placement of Bulgaria under enhanced surveillance by the FATF is a significant development for NPOs operating in the country. As the government works to address the identified deficiencies, it is essential that NGOs are aware of the new obligations and requirements and take steps to ensure compliance.