Financial Crime World

Yemen’s Financial Institutions Strengthen Fight Against Financial Crime

The Financial Intelligence Unit (FIU) in Aden has released its second annual report, highlighting the unit’s growing strength in combating financial crime and money laundering in Yemen. The report showcases the FIU’s efforts to identify patterns and trends in financial data that may indicate connections to criminal and terrorist activities.

Establishment of the FIU

The FIU was established in 2019 as a central hub for receiving, analyzing, and disseminating financial intelligence related to suspicious transactions and activities. Since 2020, experts from USAID’s Economic Recovery and Livelihoods Program (ERLP) have been working closely with the FIU head, Mr. Basem Dabwan, and his team to establish the foundation for the unit to function effectively.

Significant Achievements

  • The publication of Yemen’s AML/CFT law, which identified areas in need of revision to meet international standards set by the Financial Action Task Force (FATF)
  • Key amendments to address shortcomings in the law through analysis and recommendations reviewed with FIU staff
  • Update of two circulars by the Central Bank of Yemen:
    • First circular: Instructions on bank compliance policies necessary to meet AML/CFT requirements
    • Second circular: Precise indicators and red flags related to human trafficking, sexual exploitation, and insurance fraud schemes

Collaboration with USAID/ERLP

Through cooperation with USAID/ERLP, the FIU has addressed legislative and legal gaps, resulting in:

  • An improved business environment
  • Heightened transparency and integrity
  • The distribution of circulars to banks and financial institutions, requiring them to classify clients according to risk posed and submit detailed annual reports evaluating any such risks

Establishment of AML/CFT Unit

The collaboration has also supported the establishment of a five-person AML/CFT unit within the Central Bank of Yemen to oversee inspections of banks and exchange houses.

International Cooperation

The FIU has expanded its national and international network by signing information-sharing memoranda of understanding (MOUs) with financial intelligence units in six countries:

  • Algeria
  • Ethiopia
  • Jordan
  • Libya
  • Somalia
  • United Arab Emirates

Conclusion

The FIU head, Mr. Basem Dabwan, praised the collaboration, saying that it has been instrumental in enhancing the unit’s financial intelligence capabilities and demonstrating USAID’s commitment to fostering regulatory compliance and integrity within Yemen’s financial system. The FIU is committed to presenting itself in the best possible light, adhering to the highest standards and qualities, and looks forward to further enhancing its positive image through continued partnership and cooperation with USAID/ERLP.