Financial Crime World

Eritrea’s Financial Institutions Upgrade Security Measures to Comply with International Standards

As part of its efforts to combat money laundering and terrorist financing, Eritrea’s financial institutions have implemented significant security measures to comply with international standards. According to a recent report, the country has made substantial progress in implementing technical requirements recommended by the Financial Action Task Force (FATF).

Progress Made

The report assesses the extent to which Eritrea has complied with FATF recommendations and shows that the country has made notable improvements in several areas.

  • Risk Assessment: Eritrea’s financial institutions have implemented measures to assess risk and apply a risk-based approach to combating money laundering and terrorist financing.
  • National Cooperation and Coordination: The country has strengthened its national cooperation and coordination efforts, as well as its laws and regulations governing money laundering and terrorist financing offenses.
  • Asset Confiscation: Eritrea has taken steps to confiscate and freeze assets related to terrorism and terrorist financing.

Areas for Improvement

However, there are still areas where Eritrea needs to improve:

  • Non-Profit Organization Risk Management: The country’s financial institutions have not yet fully implemented measures to prevent the misuse of non-profit organizations for illicit purposes.

Technical Compliance

Eritrea has made significant progress in implementing several key recommendations related to technical compliance, including:

  • Customer Due Diligence: Measures have been put in place to ensure customer due diligence.
  • Record Keeping: Financial institutions are maintaining accurate records.
  • Suspicious Transaction Reporting: Steps have been taken to report suspicious transactions.

Internal Controls and Supervision

Eritrea’s financial institutions have implemented internal controls and foreign branch and subsidiary regulations to prevent money laundering and terrorist financing. The country has also:

  • Regulated and Supervised Financial Institutions: Measures have been taken to regulate and supervise financial institutions and Designated Non-Financial Businesses and Professions (DNFBPs).
  • Strengthened Supervisor Powers: The government has strengthened its powers of supervisors, enabling them to effectively monitor and enforce compliance with anti-money laundering and combating the financing of terrorism regulations.

Correspondent Banking Services and Cash Couriers

Eritrea’s financial institutions have implemented measures to prevent the misuse of correspondent banking services and money or value transfer services. The country has also:

  • Regulated DNFBPs: Steps have been taken to regulate and supervise DNFBPs.
  • Combated Cash Couriers: Measures have been put in place to combat cash couriers.

Conclusion

Eritrea’s efforts to implement FATF recommendations demonstrate a commitment to strengthening its financial system and preventing illicit activities such as money laundering and terrorist financing. As the country continues to work towards full compliance with international standards, it is likely that its financial institutions will become more attractive to foreign investors and businesses.