Financial Crime World

Czech Republic Enhances Anti-Money Laundering Measures: MONEYVAL Report Documents Progress

The Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL) has published its 2nd Enhanced Follow-up Report (FUR) on the Czech Republic’s progress in improving their Anti-Money Laundering/Counter-Terrorist Financing (AML/CFT) framework.

Background

  • MONEYVAL is a permanent monitoring body responsible for assessing adherence to international standards against money laundering and terrorist financing.
  • The organization evaluates implementation and provides recommendations for improvement.

Report Highlights Progress in the Czech Republic

The report acknowledges the progress made by the Czech Republic since their Mutual Evaluation Report (MER) in December 2018. Since publishing the MER, the country submitted periodic reports documenting their efforts to address the identified technical compliance deficiences.

Upgraded Recommendations

The report highlights the significant strides made by the Czech Republic in addressing several recommendations, moving them from Partially Compliant (PC) to Large Compliant (LC):

  1. Recommendation 8
  2. Recommendation 20
  3. Recommendation 22
  4. Recommendation 23
  5. Recommendation 35

Recommendation 21, previously rated as PC, has also been upgraded to Compliant (C) due to a recent amendment.

Adoption of the Act on BO Register

One achievement noted in the report is the adoption and establishment of the Act on Beneficial Owner (BO) Register, leading to a more accurate BO information database.

Improvements in the NPO sector

The report highlights efforts made to tackle issues related to the Non-Profit Organization (NPO) sector, including:

  • Awareness-raising materials
  • Encouragement of regulated channels
  • Risk-based approaches

Areas for Improvement

Risk-Based Approaches and VASP Sector

The report emphasizes that progress towards risk-based approaches, particularly in the Virtual Asset Service Provider (VASP) sector and the Financial Analysis Unit, remains a concern.

STR Definition and Reporting

The Czech Republic’s approach to defining and reporting Suspicious Transaction Reports (STRs) requires clarification and optimization.

Ongoing Efforts

The Czech Republic will continue to address these and other remaining deficiencies and report back to MONEYVAL within one year to demonstrate further progress.

Conclusion

The report signifies that the Czech Republic has made considerable headway in enhancing its AML/CFT framework and remains committed to the effective implementation of the Financial Action Task Force (FATF) Recommendations.