Financial Crime World

Czech Republic Makes Significant Strides in Combating Money Laundering and Terrorist Financing: MONEYVAL Report

The Czech Republic has made notable progress in enhancing its efforts to combat money laundering and terrorist financing, according to the latest report by the Council of Europe’s anti-money laundering and countering the financing of terrorism (AML/CFT) body, MONEYVAL.

Substantial Improvement in the Czech Republic’s Compliance with FATF Standards

The reportindicates a substantial improvement in the country’s level of compliance with the Financial Action Task Force (FATF) standards. Following an evaluation report adopted in 2018 that identified several shortcomings, MONEYVAL requested the Czech authorities to address these issues under the Enhanced Follow-Up Procedure.

Upgraded Compliance Ratings

Building on the steps taken by the Czech authorities, MONEYVAL has upgraded the country’s compliance ratings. The Czech Republic’s compliance ratings for five FATF recommendations have been upgraded from “partically compliant” to “largely compliant,” and one FATF recommendation rating has been upgraded from “partially compliant” to “compliant.”

  1. Improved Sanctioning Regime
  2. Non-profit Organizations
  3. Reporting Obligations
  4. Tipping-off
  5. Compliance of Designated Non-financial Businesses and Professions Regarding AML/CFT Obligations

Remaining Challenges

Despite making significant progress towards addressing most of the technical compliance deficiencies in the post-evaluation period, there is a need for more action to fully implement international AML/CFT standards.

  • The Czech Republic currently complies with six of the forty FATF recommendations
  • 29 recommendations, where the country is considered “largely compliant,” still require further action
  • Five recommendations, including targeted financial sanctions, virtual assets, cash couriers, and maintaining statistics, still rate as “partially compliant.”

Report Focus and Next Steps

This report by MONEYVAL focuses only on formal changes in the legislative, regulatory, and institutional framework and does not assess the effectiveness of these reforms in practice. The Czech Republic has been advised to report back to MONEYVAL on further progress in strengthening its AML/CFT measures within one year.

[Link to the Report]

Strasbourg, 8 December 2021