Title: FATF Report: Belgium Needs to Strengthen Anti-Money Laundering and Counter-Terrorist Financing Measures

Brussels - FATF Identifies Areas for Improvement in Belgium’s AML/CTF Measures

The Financial Action Task Force (FATF) recently released its Mutual Evaluation Report on Belgium’s anti-money laundering (AML) and counter-terrorist financing (CTF) measures. The report outlined several areas where Belgium needs to strengthen its efforts to effectively combat money laundering (ML) and terrorist financing (TF) risks.

Key Findings from the FATF Report

Below are the main findings from the FATF report on Belgium’s AML/CTF system:

1. Fragmented and Incomplete Risk Assessment: While Belgium has conducted national ML and TF risk assessments, the findings have not been effectively incorporated into its national AML/CTF policy.

2. Limited Resources Impacting Investigations: Belgian law enforcement agencies have experienced success in prosecuting ML cases. However, resource constraints impede their capacity to pursue all financial ramifications and identify connections between seemingly unrelated cases.

3. Improvements Needed in Prosecution: ML prosecutions in Belgium primarily focus on economic offenses, with a need for more targeted investigations of structured ML systems involving third parties.

4. Inadequate ML/TF Understanding Among Non-Financial Businesses and Professions: Sectors like diamond dealers, casinos, and bureaux de change must improve their understanding of ML/TF risks and reporting of suspicious transactions.

5. Lack of Effective ML/TF Risk-Based Controls for All Entities: Regulatory oversight and risk-based AML/CTF controls are crucial, particularly in sectors with high ML/TF risks such as money transfer services and diamond dealers.

Recommendations for Strengthening Belgium’s AML/CTF System

To address the identified weaknesses and improve its AML/CTF system, Belgium must:

1. Incorporate Risk Assessment Findings: Adopt the findings from national risk assessments into its AML/CTF policy.

2. Develop a National Strategy: Create a national strategy to address identified ML/TF risks and allocate resources effectively.

3. Improve Collaboration: Enhance collaboration among authorities to share intelligence and expertise.

4. Enhance ML/TF Risk-Based Controls: Strengthen ML/TF risk-based controls, particularly in high-risk sectors.

5. Encourage DNFBPs: Encourage designated non-financial businesses and professions (DNFBPs) to implement more robust ML/TF risk management policies.

6. Establish a More Systematic Approach: Develop a more systematic approach to reporting and investigating suspicious transactions.

The FATF will monitor Belgium’s progress in implementing these recommendations in future evaluations.