Financial Crime World

Fiji’s Efforts to Combat Money Laundering and Terrorist Financing Under Scrutiny

The Financial Action Task Force (FATF) has released its Mutual Evaluation Report for Fiji, assessing the country’s implementation of anti-money laundering (AML) and combating the financing of terrorism (CFT) measures. The report highlights areas where Fiji needs to improve in order to meet international standards.

Assessing Risk and Applying a Risk-Based Approach

Fiji was found to be partially compliant with Recommendation R.1, which requires countries to assess the risk of money laundering and terrorist financing and apply a risk-based approach to AML/CFT measures. The country’s financial intelligence unit (FIU) is responsible for assessing the risks associated with various sectors and activities.

National Cooperation and Coordination

Fiji was found to be partially compliant with Recommendation R.2, which requires countries to establish effective national cooperation and coordination mechanisms to combat money laundering and terrorist financing. The country has made efforts to establish a national AML/CFT committee, but its effectiveness is limited due to inadequate resources and lack of clear roles and responsibilities.

Money Laundering Offence

Fiji was found to be compliant with Recommendation R.3, which requires countries to criminalize money laundering. The country’s Money Laundering Act provides for the confiscation of proceeds of crime and the freezing of assets related to money laundering.

Areas of Improvement

  • Confiscation and Provisional Measures: Fiji lacks effective provisional measures to prevent the dissipation of assets.
  • Terrorist Financing Offence: Fiji lacks a legal framework for imposing targeted financial sanctions on individuals and entities involved in terrorism and terrorist financing.
  • Targeted Financial Sanctions Related to Proliferation: Fiji lacks a legal framework for imposing targeted financial sanctions on individuals and entities involved in the proliferation of weapons of mass destruction.
  • Non-Profit Organisations: Fiji’s regulations for non-profit organizations are inadequate and lack effective monitoring mechanisms.
  • Financial Institution Secrecy Laws: Fiji has repealed its bank secrecy law, but the country’s record-keeping requirements are inadequate, and there is a lack of effective monitoring mechanisms in place.
  • Customer Due Diligence: Fiji’s customer due diligence regime lacks effective monitoring mechanisms and training for financial institution staff.
  • Record Keeping: Fiji’s record-keeping requirements are inadequate, and there is a lack of effective monitoring mechanisms in place.
  • Politically Exposed Persons: Fiji’s regime for regulating politically exposed persons is inadequate, and there is a lack of effective monitoring mechanisms in place.
  • Correspondent Banking: Fiji lacks a legal framework for regulating correspondent banking relationships.
  • Money or Value Transfer Services: Fiji lacks a legal framework for regulating money or value transfer services (MOT).
  • New Technologies: Fiji’s regime for regulating the use of new technologies, such as digital currencies, is inadequate and lacks effective monitoring mechanisms.
  • Wire Transfers: Fiji’s reporting requirements are inadequate, and there is a lack of effective monitoring mechanisms in place.
  • Reliance on Third Parties: Fiji’s regime for regulating the use of third-party services for AML/CFT purposes is inadequate and lacks effective monitoring mechanisms.
  • Internal Controls and Foreign Branches and Subsidiaries: Fiji’s internal control requirements are inadequate, and there is a lack of effective monitoring mechanisms in place.

Conclusion

The article highlights the need for Fiji to strengthen its legal framework and regulatory regime to prevent money laundering and terrorist financing. It also emphasizes the importance of international cooperation and information sharing in combating these crimes.