Financial Crime World

Macao’s AML/KYC Compliance Checklists: A Mixed Bag

The Financial Action Task Force (FATF) has released a report assessing Macao’s implementation of anti-money laundering and know-your-customer (AML/KYC) compliance checklists. The report highlights both the country’s progress and areas where it falls short.

Key Areas of Progress

  • Risk Assessment and Risk-Based Approach: Macao received a largely compliant rating in this area, indicating that the country has made significant progress in assessing risk and applying a risk-based approach to AML/KYC compliance.
  • National Cooperation and Coordination: The country also demonstrated compliance in national cooperation and coordination (R.2), which suggests strong collaboration among government agencies and financial institutions.
  • Money Laundering and Terrorist Financing Offences: Macao received largely compliant ratings for money laundering offence (R.3) and terrorist financing offence (R.5), indicating that the country has made progress in preventing these crimes.

Areas for Improvement

  • Customer Due Diligence Measures: While Macao has made some progress in this area, it still requires improvement to meet international standards.
  • Record-Keeping Requirements: The country received a partially compliant rating for record-keeping requirements (R.11), which suggests that there is room for improvement in this area.
  • Financial Institution Secrecy Laws: Macao was rated non-compliant in this area, indicating that the country’s laws do not adequately prevent the misuse of companies and trusts for illicit purposes.

Recommendations for Improvement

The FATF has recommended that Macao strengthen its regulations and supervision in several areas, including:

  • Supervision of Designated Non-Financial Businesses and Professions (DNFBPs): The country should improve its supervision of DNFBPs to ensure that they comply with AML/KYC regulations.
  • Financial Intelligence Units: Macao should strengthen its financial intelligence units to enhance their ability to detect and prevent money laundering and terrorist financing.

Overall, while Macao’s AML/KYC compliance checklists have shown some progress, there is still much work to be done to ensure the country meets the FATF’s standards.