Financial Crime World

Cypriot Authorities Publish First National Risk Assessment of Money Laundering and Terrorist Financing Risks

The Central Bank of Cyprus and the Financial Intelligence Unit (FIU) have published their first National Risk Assessment (NRA) of Money Laundering and Terrorist Financing Risks, a comprehensive study aimed at identifying and assessing the country’s vulnerabilities to money laundering and terrorist financing.

Background

The assessment was conducted in accordance with international recommendations from the Financial Action Task Force (FATF) and the EU’s 4th Anti-Money Laundering Directive. The NRA took two years to complete and utilized the World Bank methodology. The study involved public bodies and stakeholders from the private sector, and its findings were presented in a concise report published on November 13th, 2018. A more detailed briefing will be provided to relevant stakeholders in due course.

Key Findings

The assessment identified several risk-reducing measures that have been adopted since 2012, including:

  • Enhancements to anti-money laundering (AML) and counter-terrorist financing (CFT) legislation
  • Improvements to the preventive measures of supervisory authorities
  • Close cooperation among authorities and law enforcement agencies

Cyprus also has a comprehensive legal system with:

  • Asset recovery laws
  • Tax transparency
  • Effective exchange of information with other countries

Areas for Improvement

However, the NRA also highlighted areas where more risk-reducing measures are needed. In response, the Cypriot authorities have drawn up specific actions to strengthen the country’s AML/CFT framework, including:

  • Issuing directives to banks on preventive measures
  • Enhancing internal controls in the administrative services sector
  • Augmenting the resources of supervisory authorities and the FIU

Commitment to Minimizing Risks

The government, supervisory authorities, and FIU remain committed to minimizing money laundering threats and risks to Cyprus’ financial system. The NRA provides a valuable tool for all stakeholders involved in enhancing the effectiveness of AML/CFT measures and ensuring the integrity of the country’s financial sector.

Conclusion

The publication of the first National Risk Assessment of Money Laundering and Terrorist Financing Risks marks an important step towards strengthening the country’s AML/CFT framework. The Cypriot authorities are committed to continuing their efforts to minimize money laundering threats and risks, ensuring a safer and more secure financial system for all stakeholders.