Financial Crime World

Here is the converted article in Markdown format:

France’s Fight Against Terror Financing and Money Laundering Requires Improvement

Paris, France - A recent evaluation by the Financial Action Task Force (FATF) has highlighted significant improvements in France’s anti-money laundering (AML) and counter-terrorist financing (CFT) measures. However, the report also identifies major shortcomings that need to be addressed to prevent terrorists, financiers, and proliferators from abusing the non-profit organization (NPO) sector and evading law enforcement.

France has a robust and sophisticated AML/CFT legal framework, which has been strengthened through various reforms and improvements since its third-round evaluation. The establishment of the National Financial Prosecutor’s Office (PNF) and the National Anti-Terrorism Prosecutor’s Office (PNAT), as well as the introduction of the “basic presumption of criminal origin of assets or income” in 2013, are notable innovations.

Preventive Measures

While France has made significant progress in implementing preventive measures, moderate shortcomings remain. Due diligence obligations relating to politically exposed persons (PEPs) and enhanced measures for correspondent banking relationships need to be strengthened. The regime applicable to NPOs at TF risk also requires improvement.

  • Strengthen due diligence obligations for PEPs
  • Enhance measures for correspondent banking relationships
  • Improve the regime for NPOs at TF risk

Risk Assessment and Coordination

France has a good understanding of the risks related to ML and TF, as reflected in its 2019 national risk assessment (NRA). However, the assessment of risks for certain sectors and activities, such as real estate, virtual assets, and cash, must be deepened. National policies are mainly implemented through thematic action plans, which pay particular attention to CFT issues.

  • Deepen the assessment of risks for certain sectors and activities
  • Improve national policies through thematic action plans

Financial Intelligence and Investigations

TRACFIN, France’s financial intelligence unit (FIU), plays a key role in investigating ML cases and tracing the proceeds of crime. It regularly uses financial intelligence and other relevant information to investigate ML cases and TF. However, not all available information is exploited in an optimal manner, and there could be further increases in the dissemination of information.

  • Optimize the use of financial intelligence and other relevant information
  • Increase the dissemination of information

Investigations and Prosecutions

France is very active in investigating complex and highly complex ML cases, with a significant number of prosecutions and convictions per year. The authorities favor a “top-down” approach in prioritizing the pursuit of high-end ML cases. However, the number of ML cases related to corruption and human trafficking is low.

  • Prioritize the pursuit of high-end ML cases
  • Increase efforts to investigate ML cases related to corruption and human trafficking

Conclusion

While France has made significant progress in implementing AML/CFT measures, major improvements are needed to improve supervision and the implementation of preventive measures, particularly for DNFBPs (designated non-financial businesses and professions). The authorities must also address the lack of specialized investigators and work to optimize the dissemination of information.

  • Improve supervision and implementation of preventive measures
  • Address the lack of specialized investigators
  • Optimize the dissemination of information