Financial Crime World

Combating the Financing of Terrorism: Ireland’s Progress Reportedly Meets FATF Guidelines, with Some Areas Requiring Improvement

Ireland has made significant strides in combating the financing of terrorism (CFT), according to a recent report by the Financial Action Task Force (FATF). The country’s 2022 Follow-Up report shows that it is largely compliant with the technical requirements outlined in the FATF Recommendations, with some areas requiring further improvement.

Assessment of Ireland’s Progress

The report assesses Ireland’s progress across various key areas, including:

  • Assessing Risk and Applying a Risk-Based Approach: Ireland has demonstrated compliance or largely complied with the recommendations.
  • National Cooperation and Coordination: Ireland has shown compliance with the recommendations.
  • Confiscation and Provisional Measures: Ireland has largely complied with the recommendations.

Areas Requiring Improvement

However, there are some areas where Ireland requires improvement, including:

  • Regulations and Supervision of Financial Institutions: Enhancing regulations and supervision is necessary to prevent the misuse of financial systems.
  • Powers of Supervisors and Law Enforcement Authorities: Strengthening powers is crucial for effective enforcement.
  • Transparency and Beneficial Ownership Requirements: Improving transparency and beneficial ownership requirements for legal persons and arrangements is essential.

Progress in Implementing Targeted Financial Sanctions

Ireland has also made progress in implementing targeted financial sanctions related to:

  • Terrorism and Terrorist Financing: The country’s correspondent banking and money or value transfer services are largely compliant with the recommendations.
  • Proliferation: Ireland has implemented measures to prevent the misuse of financial systems for proliferation activities.

Room for Improvement

Despite these achievements, there are still some areas where Ireland requires improvement, including:

  • Record Keeping Requirements for DNFBPs (Designated Non-Financial Businesses and Professions): Enhancing record keeping requirements is necessary.
  • Guidance and Feedback Mechanisms: Improving guidance and feedback mechanisms is essential.

The FATF Recommendations

The FATF Recommendations provide a framework for countries to combat the financing of terrorism and terrorist financing. The recommendations aim to:

  • Prevent the misuse of financial systems by terrorists and other criminal organizations
  • Ensure that financial institutions are not used to facilitate illegal activities

Conclusion

Overall, Ireland’s progress in combating the financing of terrorism is commendable, but there is still room for improvement. The country should continue to strengthen its regulations and supervision of financial institutions, as well as its powers of supervisors and law enforcement authorities. By doing so, Ireland can further reduce the risk of terrorist financing and ensure that its financial system is not used to facilitate illegal activities.