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Financial Inclusion and Crime in Iceland: A Limited Risk Exposure
July 28, 2023 - Reykjavik, Iceland
According to a recent report by an international organization, Iceland’s banking sector faces limited risks of financial crime due to its small size and geographical limitations. The country’s economic fundamentals also play a significant role in reducing the risk exposure.
Limited Risk Factors
- Small size: Iceland’s foreign trade and direct investments are relatively low, resulting in a reduced level of cross-border payments activity.
- Geographical limitations: There is minimal flow with countries identified as high-risk for money laundering (ML) and terrorist financing.
- Low incidence of outlier transactions: There is a low incidence of outlier cross-border payments that cannot be explained by economic fundamentals.
Strong Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) Measures
Iceland has implemented strong AML/CFT measures to prevent financial crime, including:
- Strict regulations: The country’s commercial banks and correspondent banking relationships are subject to strict regulations and oversight.
- Effective monitoring and enforcement: The government continues to monitor and update its policies to stay ahead of emerging threats.
Expert Insights
Experts say that while Iceland’s risk exposure is limited, it remains important for the country to maintain its strong AML/CFT standards and continue to monitor and update its policies to stay ahead of emerging threats.
Full Report Available
The report is part of a series of country reports on anti-money laundering and combating the financing of terrorism. The full report can be downloaded for free in PDF format from the international organization’s website.