Financial Crime World

France’s Ongoing Battle Against Money Laundering and Terrorist Financing: Progress and Challenges

Overview

Paris, May 17, 2022 - France has witnessed significant progress in its battle against money laundering and terrorist financing, yet challenges persist, mainly in the areas of professional supervision and real estate sector oversight.

Money Laundering Threats and Response

  • France faces various money laundering threats, including tax fraud and drug trafficking.
  • Devastating 2015 terrorist attacks prompted decisive government action.
  • Legal framework adapted to address threats through comprehensive national policies.

Areas for Improvement

Risk-Based Supervision

  • Strengthening supervision of designated non-financial businesses and professionals.
  • Real estate agents and notaries require particular attention.

Adherence to AML/CFT Obligations

  • Non-financial entities’ adherence to AML/CFT obligations improved but remains insufficient.

Awareness of Obligations

  • Inadequate awareness of obligations, specifically regarding beneficial ownership, politically exposed persons, and suspicious transaction reporting.

Investigative Resources and Competent Personnel

  • Effective investigations require investigative resources and competent personnel.
  • While progress has been made, a lack of specialized investigative resources impedes progress.

Recovering Criminal Assets

  • Impressive results from French efforts to recover criminal assets, with over EUR 4.7 billion being confiscated annually.

International Cooperation

  • Robust international cooperation through mutual legal assistance and informal cooperation.

Combating Terrorism and Its Financing

  • Effective collaboration in targeted investigations, with conviction rates for terrorist financing prosecutions at 93%.

Global Sanctions

  • France plays a critical role in submitting terrorist financing individuals or entities to global sanctions lists.
  • Reform allows for immediate imposition of targeted financial sanctions, but proper implementation is yet to be seen.

FATF Report Findings

A recent report adopted by the Financial Action Task Force (FATF) at its March 2022 Plenary Meeting highlights progress in France’s efforts to combat money laundering and terrorist financing, while also pointing to areas requiring improvement.