Financial Crime World

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Libyan Arab Jamahiriya Falls Short on Anti-Money Laundering Measures, Report Finds

A recent follow-up report by the Financial Action Task Force (FATF) has revealed that Libya’s efforts to combat money laundering and terrorist financing remain incomplete. The country received ratings of “partially compliant” or “non-compliant” in several areas, highlighting ongoing weaknesses in its anti-money laundering (AML) framework.

Key Findings

  • Libya’s rating for assessing risk and applying a risk-based approach was listed as “largely compliant”.
  • National cooperation and coordination also received a “largely compliant” rating.
  • However, the country fell short in several key areas, including:
    • Confiscation and provisional measures
    • Terrorist financing offence
    • Transparency and beneficial ownership of legal persons

Weaknesses Identified

  • Libya’s financial institution secrecy laws were deemed “compliant”, but this has been criticized.
  • Customer due diligence requirements received a “partially compliant” rating.
  • Record-keeping practices were listed as “largely compliant”, but reliance on third parties was rated only “partially compliant”.

Concerns and Recommendations

Libya’s lack of progress in implementing the FATF Recommendations has raised concerns about the country’s ability to effectively combat money laundering and terrorist financing. The report emphasized the need for further improvements, particularly in areas such as transparency and beneficial ownership of legal persons.

The Libyan government has been urged to address these weaknesses and implement additional measures to strengthen its AML regime. Failure to do so could result in increased financial sanctions and reputational damage.

About FATF

The Financial Action Task Force (FATF) is an intergovernmental organization that sets global standards for combating money laundering, terrorist financing, and other related threats. Its recommendations provide a framework for countries to assess and mitigate these risks.