Korea’s Non-Profit Organizations Face Challenges in Anti-Money Laundering Efforts
Seoul, South Korea - A Report by the Financial Action Task Force (FATF)
A recent report by the Financial Action Task Force (FATF) has highlighted concerns about the anti-money laundering (AML) efforts of non-profit organizations (NPOs) operating abroad and those at risk of being exploited for terrorist financing.
NPOs Operating Abroad: Effective Supervision and Support
According to the report, NPOs operating abroad are subject to robust reporting and supervision requirements, as well as access to ongoing outreach and support. This ensures that these organizations are equipped to effectively prevent money laundering and terrorist financing.
At-Risk NPOs: Need for Active Engagement and Guidance
However, other at-risk NPOs would benefit from active engagement and guidance on AML/CFT measures. These organizations require additional support to ensure they are compliant with international standards and effective in preventing illicit activities.
Korea’s Anti-Money Laundering Efforts: Effective but Room for Improvement
The report found that Korea has a low risk profile for terrorist financing (TF), with no reported cases of assets being used for TF purposes. The country’s anti-money laundering efforts are considered effective, with the Financial Intelligence Unit (KoFIU) playing a key role in providing guidance and outreach to supervised sectors.
Areas for Improvement
Despite these positive findings, the report identified several areas where improvement is needed:
- Extending the AML/CFT framework to apply to all designated non-financial businesses and professions (DNFBPs)
- Expanding the scope of AML/CFT obligations to include domestic public officials and employees of international organizations
- Amending the law to expand the range of tax crimes that are considered predicate offenses
Improving Asset Recovery and Remedial Actions
The report also highlighted the need for Korea to improve its ability to recover assets ordered for confiscation and to systematically take remedial actions in response to deficiencies identified during AML/CFT assessments.
Government Response: Commitment to Improvement
In response to the report’s findings, Korean authorities have pledged to take immediate action to address these concerns. “We are committed to ensuring that our anti-money laundering efforts are effective and robust,” said a government official. “We will work closely with international partners to improve our systems and ensure that we are doing everything possible to prevent money laundering and terrorist financing.”
Conclusion
The FATF report provides a comprehensive overview of Korea’s anti-money laundering efforts and highlights the need for continued improvement and strengthening of these systems to prevent money laundering and terrorist financing. The country is committed to addressing the identified concerns and ensuring its AML/CFT efforts are effective and robust.