Financial Crime World

Jordan’s Fight Against Money Laundering: An Overview

The Hashemite Kingdom of Jordan has been identified as a country with a high level of national money laundering risks, according to a recent report. With a risk score of 4.1 out of 7.0, the country’s financial sector is vulnerable to illegal activities.

Economy and Financial Sector

Jordan’s economy is considered medium-sized, with a gross domestic product (GDP) of approximately $31.1 billion in Jordanian dinars (JD). The country has a population of around 10.1 million people and consists of 12 governorates covering an area of 92,300 square kilometers.

  • The financial sector in Jordan is dominated by banks, which account for 93.4% of the total assets of the financial sector in 2018.
  • Money exchange companies also play a significant role, with a volume of transfers amounting to approximately JD 10.2 billion in 2018.

Money Laundering Risks

The country’s risk assessment has identified several threats and vulnerabilities that contribute to its high level of money laundering risks. These include:

  • Illegal acquisition of assets
  • Criminal proceeds from domestic crimes
  • Foreign proceeds from crimes committed outside Jordan

Domestic Proceeds

The value of domestic proceeds from predicate crimes is estimated to be around JD 941 million, or approximately 3.7% of GDP.

  • The majority of these proceeds come from tax evasion (93%), with the remaining 7% coming from other crimes such as fraud and smuggling.
  • Tax evasion is one of the top crime types in Jordan, with an estimated value of criminal proceeds amounting to JD 695 million.
  • Most of these proceeds are generated in cash, while a significant portion is deposited into personal bank accounts.

Conclusion

Jordan’s financial sector faces several challenges in combating money laundering, including:

  • Illegal acquisition of assets and criminal proceeds from domestic crimes.
  • Tax evasion as one of the top crime types, with an estimated value of criminal proceeds amounting to JD 695 million.

To address these challenges, Jordan must implement effective measures to prevent and detect money laundering activities, including:

  • Strengthening its anti-money laundering regulations
  • Increasing international cooperation to trace and recover illegal funds.