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Jordan’s Financial Transactions Regime Under Scrutiny: Compliance with FATF Recommendations

In a recent evaluation, Jordan has been assessed on its implementation of the Financial Action Task Force (FATF) Recommendations, which set standards for combating money laundering and terrorist financing. The evaluation found that Jordan has made significant progress in implementing these standards, but there are still areas that require improvement.

Assessing Risk and Applying a Risk-Based Approach

Jordan has shown compliance with Recommendation R.1 by assessing risk and applying a risk-based approach. This indicates that the country’s financial institutions have been able to identify high-risk customers and transactions and take appropriate measures to mitigate those risks.

Challenges in Implementing Recommendations

However, Jordan has faced challenges in implementing some of the recommendations. For example:

• National Cooperation and Coordination: Jordan has struggled with national cooperation and coordination, as required by Recommendation R.2. While there are laws in place that require financial institutions to report suspicious transactions, there have been instances where this information has not been shared effectively between different government agencies.
• Preventing the Financing of Terrorist Activities: Jordan has faced difficulties in implementing measures to prevent the financing of terrorist activities, as required by Recommendations R.5 and R.6. While there are laws in place that criminalize the financing of terrorism, there is still a lack of clarity around what constitutes a terrorist organization and how financial institutions should identify and report suspicious transactions.
• Preventing the Proliferation of Weapons of Mass Destruction: Jordan has faced challenges in implementing measures to prevent the proliferation of weapons of mass destruction, as required by Recommendation R.7. While there are laws in place that prohibit the transfer of funds or other assets to individuals or organizations involved in the development or production of such weapons, there is still a lack of clarity around how financial institutions should identify and report suspicious transactions.

FATF Recommendations

Here is an overview of Jordan’s compliance with FATF recommendations:

Conclusion

While Jordan has made progress in implementing the FATF Recommendations, there are still areas where it needs to improve. The country’s financial authorities have recognized these challenges and are working to address them, but it will likely take some time for Jordan to achieve full compliance with the standards.