Financial Crime World

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Macao’s Anti-Money Laundering Policies Under Scrutiny

A recent evaluation of Macao’s anti-money laundering (AML) policies and procedures has revealed a mixed bag of compliance with international standards. The Financial Action Task Force (FATF), an intergovernmental organization that sets global AML norms, conducted the assessment in 2017.

Macao’s Performance: Strengths and Weaknesses

According to the report, Macao has made significant progress in implementing certain FATF recommendations, but there are areas where improvement is needed. Here are some of the key findings:

Strengths

  • Risk-Based Approach: Macao has demonstrated its ability to assess and apply a risk-based approach (R.1) in its AML regime.
  • National Cooperation and Coordination: The country’s national cooperation and coordination mechanisms (R.2) have been effective in combating money laundering.
  • Customer Due Diligence Measures: Macao’s customer due diligence measures (R.10) have been implemented effectively.

Non-Compliance Areas

  • Confiscation and Provisional Measures: Macao’s laws and regulations do not provide sufficient powers for authorities to confiscate assets linked to money laundering (R.4).
  • Targeted Financial Sanctions: The country has not implemented adequate measures to prevent the misuse of its financial system for terrorism and terrorist financing (R.6) and proliferation (R.7).

Partial Compliance Areas

  • Money or Value Transfer Services: Macao’s regulations do not adequately cover all types of money or value transfer services (R.14).
  • Correspondent Banking and Wire Transfers: The country’s regulations do not provide sufficient guidance on correspondent banking (R.13) and wire transfers (R.16).

Reforms and Enhancements

To address the deficiencies, Macao has committed to implementing reforms and enhancing its AML regime. The country aims to strengthen its laws and regulations, improve its supervisory powers, and enhance international cooperation.

The FATF evaluation serves as a wake-up call for Macao to strengthen its AML framework and ensure that it is in line with global standards.