Financial Crime World

Jordan’s Financial Sector Faces High Money Laundering Risks

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Amman - The Hashemite Kingdom of Jordan has been assessed as facing a “high” level of national money laundering risks, with a country risk score of 4.1 out of 7.0, according to a recent report.

Overview of Jordan’s Financial Sector

Jordan’s financial sector is comprised of approximately 6,000 regulated institutions and non-profit organizations, in addition to around 195,000 legal entities. Banks are the main component of the sector, with bank assets accounting for 93.4% of the total assets of the financial sector in 2018.

Key Components of Jordan’s Financial Sector

  • Banks: Bank assets accounted for 93.4% of the total assets of the financial sector in 2018.
  • Money Exchange Sector: Although relatively small compared to other sectors, the money exchange sector played a significant role in the country’s financial transactions, with a volume of transfers executed through the sector amounting to approximately JD 10.2 billion in 2018.
  • Designated Non-Financial Businesses and Professions:
    • Real Estate Offices: The volume of trading in the real estate market during 2018 was around JD 5 billion, with JD 4 billion accounting for 14% of GDP.
    • Jewelry Shops: Total assets were JD 128 million and sales volume was JD 33.6 million in 2018.

Money Laundering Risks in Jordan’s Financial Sector

The report highlighted the risks posed by money laundering in Jordan’s financial sector, including:

  • Domestic Money Laundering Threats: The country faces a “medium” level of domestic money laundering threats, with proceeds from predicate crimes estimated at around JD 941 million, or approximately 3.7% of GDP.
  • Top Five Crime Types Contributing to Money Laundering:
    • Tax Evasion: Criminal proceeds estimated at around JD 695 million
    • Robbery/Criminal Theft
    • Theft
    • Trafficking in Illicit Drugs
    • Corruption and Bribery

Recommendations for Combating Money Laundering

The report emphasized the need for effective measures to combat money laundering in Jordan’s financial sector, including:

  • Improved Regulation
  • Enhanced Customer Due Diligence
  • Increased Cooperation between Law Enforcement Agencies and Financial Institutions

Source: [Name of organization], “Money Laundering Risks in Jordan’s Financial Sector” (2022)