Financial Crime World

Kazakhstan Makes Progress in Implementing Anti-Money Laundering Rules, But Room for Improvement Remains

A recent evaluation by the Financial Action Task Force (FATF) has revealed that Kazakhstan has made significant strides in implementing anti-money laundering (AML) rules, but still lags behind in certain areas. The country received ratings of “largely compliant” or “partially compliant” in 30 out of 40 evaluated areas.

Areas of Strength

  • Risk Assessment and Risk-Based Approach: Kazakhstan showed strength in assessing risk and applying a risk-based approach, earning a rating of “largely compliant”.
  • Combating Money Laundering through Confiscation and Provisional Measures: The country demonstrated significant progress in its efforts to combat money laundering through confiscation and provisional measures.
  • Regulation and Supervision of Financial Institutions: Kazakhstan’s regulation and supervision of financial institutions were deemed effective.

Areas for Improvement

  • Customer Due Diligence, Record Keeping, and Reliance on Third Parties: The country needs improvement in these areas, which received a “partially compliant” rating.
  • Correspondent Banking Relationships: Kazakhstan’s efforts to address the risk posed by correspondent banking relationships were deemed insufficient, with a rating of “partially compliant”.
  • Laws Governing Non-Profit Organizations: The country’s laws governing non-profit organizations were deemed inadequate, earning a “largely compliant” rating.

Financial Intelligence Unit and Law Enforcement

  • Financial Intelligence Unit: Kazakhstan’s financial intelligence unit was found to be effective in collecting and analyzing financial intelligence, earning a “compliant” rating.
  • Law Enforcement and Investigative Authorities: However, the country’s law enforcement and investigative authorities were deemed to lack sufficient powers to effectively combat money laundering.

International Cooperation

  • Extradition of Individuals Involved in Money Laundering and Terrorist Financing: Kazakhstan needs to improve its international cooperation in this area.
  • Laws Governing Cash Couriers and Statistics on Money Laundering: The country’s laws governing cash couriers and statistics on money laundering were found to be inadequate.

Conclusion

While Kazakhstan has made significant progress in implementing AML rules, there is still much work to be done to bring the country fully into compliance with FATF standards.