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Indonesia’s Anti-Money Laundering Efforts Get Thumbs Up from Global Assessors
A team of international assessors from the United States, Canada, Macao-China, China-Taipei, Pakistan, and Bangladesh, along with the Asia-Pacific Group on Money Laundering (APG) Secretariat, has given Indonesia a clean bill of health in its efforts to prevent and combat money laundering and terrorist financing.
Compliance with International Standards
According to the APG’s Annual Session held in Kathmandu, Nepal, Indonesia has demonstrated significant compliance with international standards in preventing and eradicating criminal acts of money laundering and financing of terrorism. The country received a “C” rating or compliant for six out of 40 FATF recommendations related to legal framework compliance, while 29 others were deemed “largely compliant”. Only one recommendation, related to funding for the proliferation of weapons of mass destruction, received a “non-compliant” rating.
Effectiveness in Implementing AML/CFT Measures
In terms of effectiveness, Indonesia was rated “substantial” for five immediate outcomes, “moderate” for five others, and “low” for just one. The assessment found that Indonesia’s implementation of anti-money laundering and combating the financing of terrorism (AML/CFT) measures was better than those of APG member countries such as Australia, Malaysia, and Singapore.
Strengths and Progress
The assessment report highlights Indonesia’s significant progress in implementing AML/CFT measures, particularly in the areas of prevention and detection of money laundering and terrorist financing. The country’s efforts to strengthen its legal framework, enhance transparency and cooperation with other countries, and improve public awareness have all contributed to its success.
FATF Full Membership: A New Horizon for Indonesia
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Indonesia’s strong showing in the APG assessment has set the stage for the country’s bid to become a full member of the Financial Action Task Force (FATF), an inter-governmental organization that sets global standards for combating money laundering, terrorist financing, and weapons of mass destruction.
Becoming a FATF full member would not only enhance Indonesia’s reputation as a responsible financial actor but also open up new opportunities for trade and investment. It would also demonstrate the country’s commitment to upholding international standards and best practices in AML/CFT.
Bank Indonesia’s Support for Indonesia’s FATF Bid
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In support of Indonesia’s efforts to become a FATF full member, Bank Indonesia has developed three strategies aimed at fulfilling all FATF recommendations related to payment systems and foreign exchange business activities. The bank has also issued provisions and guidelines for non-bank payment system service providers and non-bank money changers, as well as financial technology companies.
Bank Indonesia’s efforts have focused on enhancing public awareness of AML/CFT principles, increasing institutional cooperation, and strengthening risk assessment and supervision. The bank has also prepared a sectoral risk assessment and risk-based approach guidelines for non-bank payment system service providers and non-bank money changers.
Conclusion
The country’s bid to become a FATF full member is seen as a significant milestone in Indonesia’s efforts to strengthen its financial sector and enhance its reputation as a responsible global player.