Financial Crime World

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Bulgaria Urged to Strengthen Efforts to Combat Financial Terrorism

In a new report, the Council of Europe’s anti-money laundering body MONEYVAL has called on Bulgaria to improve its regulatory framework and strengthen practical measures to combat money laundering and financing of terrorism. The report assesses Bulgaria’s level of compliance with the Recommendations by the Financial Action Task Force (FATF) as of September 2021.

Assessment Highlights

MONEYVAL found that Bulgaria achieved a moderate level of effectiveness in several areas, including:

  • Assessing money laundering and terrorism financing risks
  • Domestic coordination
  • Investigation and prosecution of terrorism financing
  • International cooperation

However, the report highlighted several weaknesses, including:

  • Lack of effective use of financial intelligence
  • Investigations and prosecutions of money laundering
  • Confiscation of proceeds of crime or property of equivalent value

Understanding of Risks

The report noted that Bulgaria’s understanding of money laundering risks is reasonable, but its understanding of terrorism financing risks is limited due to a lack of comprehensive statistics. It also identified challenges in inter-agency cooperation between law enforcement agencies, which is hindered by the lack of necessary technical tools.

Recommendations for Improvement

MONEYVAL recommended several improvements, including:

  • Strengthening the use of financial intelligence
  • Investigation and prosecution of money laundering
  • Confiscation regime

The report also called for Bulgaria to take a more systematic approach to investigating the financing aspects of terrorism-related offenses and improve its national mechanism for implementing targeted financial sanctions.

Additional Recommendations

Additionally, MONEYVAL urged Bulgaria to:

  • Enhance risk-based supervision or monitoring of non-profit organizations that are at risk of being misused for terrorism financing
  • Improve the knowledge of anti-money laundering and combating of financing of terrorism obligations by obliged entities

The report also highlighted concerns over the lack of measures to prevent criminals from entering certain sectors, such as:

  • Real estate brokers
  • Trusts and company service providers
  • Accountants
  • Virtual asset service providers

International Cooperation

The report concluded that despite some technical and procedural constraints, Bulgaria provides generally timely and constructive assistance in international cooperation.

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