Financial Crime World

France’s Anti-Money Laundering and Counter-Terrorist Financing Efforts: Strengths and Areas for Improvement

Paris, May 17, 2022

Robust AML/CTF Framework in France: Evolution and Challenges

France’s robust anti-money laundering (AML) and counter-terrorist financing (CTF) framework continues to adapt to the changing threat landscape. While significant progress has been made, some areas require improvement, particularly in the supervision of professionals and high-risk sectors.

Changing Threat Landscape

France, as a major European economic power and a high-risk country for money laundering and terrorism, faces various threats, including tax fraud, drug trafficking, and terrorism. In response, French authorities have prioritized identifying and addressing these risks, adapting the legal framework accordingly.

AML/CTF Understanding and Supervision

The financial sector and supervisors in France generally have a good understanding of AML/CTF risks. However, supervision of designated non-financial businesses and professions, like real estate agents and notaries, could be improved.

Achievements in AML/CTF

France’s accomplishments in AML/CTF include effective financial intelligence use, successful money laundering investigations, and prosecutions. However, the lack of specialized investigative resources prolongs complex case durations.

Asset Forfeiture

France places a high priority on confiscating criminal assets, depriving approximately €4.7 billion yearly. Authorities actively cooperate with foreign counterparts through mutual legal assistance and informal channels.

Countering Terrorism Financing

France has achieved a 93% conviction rate for terrorist financing prosecutions and effective collaboration between prosecution, investigative, and intelligence authorities. However, monitoring the non-profit sector to prevent misuse for terrorist financing remains a significant challenge.

areas for improvement

  1. Improving supervision of designated non-financial businesses and professions.
  2. Addressing the lagging awareness and adherence to AML/CTF obligations, particularly among real estate agents and business service providers.
  3. Bolstering the capacity for investigating high-end money laundering cases.
  4. Enhancing the monitoring of the non-profit sector to prevent misuse for terrorist financing.
  5. Properly implementing recent financial sanctions reforms.

FATF’s Assessment and Future Steps

In March 2022, the Financial Action Task Force (FATF) adopted a report on France’s AML/CTF efforts. The country must focus on the areas for improvement to maintain its commitment to combating money laundering and terrorism financing.