Financial Crime World

Myanmar’s Fight Against Financial Crimes Under Scrutiny

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A recent draft National Risk Assessment (NRA) by the Myanmar government has raised concerns over the country’s ability to combat financial crimes, including money laundering and terrorist financing.

Insufficient Resources and Staffing

The assessment highlights that Myanmar’s Financial Intelligence Unit (MFIU) lacks sufficient resources and staff to effectively analyze and disseminate financial intelligence. As a result:

  • ML investigations are often delayed or lack focus on tracing proceeds of crime.
  • Prosecutors and law enforcement agencies may not prioritize investigating money laundering offenses.

Lack of Awareness and Prioritization

The NRA notes that prosecutors and law enforcement agencies often lack awareness about the importance of investigating money laundering offenses. This has led to:

  • A focus on predicate crimes rather than following the money trail.
  • Inadequate prioritization of terrorist financing cases, which are only investigated after a conviction for the predicate crime has been obtained.

Asset Restraint and Confiscation Mechanisms

The assessment criticizes Myanmar’s asset restraint and confiscation mechanisms, which are not prioritized or effective in combating financial crimes. Specifically:

  • The country lacks powers to confiscate property of corresponding value.
  • Restraint and confiscation actions have been limited to proceeds from drug offenses.

Preventive Measures

To improve its preventive measures, the NRA recommends that Myanmar:

  • Provide more specific guidance to financial institutions on high-risk issues.
  • Implement effective customer due diligence (CDD) procedures.

Supervision of Banks

The assessment also criticizes the lack of comprehensive supervision of banks by the Central Bank of Myanmar (CBM), which has not imposed serious enforcement actions against banks that fail to comply with anti-money laundering and counter-terrorism financing regulations.

Recommendations for Improvement

To protect its financial system and reputation, the Myanmar government is urged to:

  • Address these concerns and take a more proactive approach to combating financial crimes.
  • Implement effective measures to prevent and detect money laundering and terrorist financing.