Macedonia’s Efforts to Combat Money Laundering and Terrorist Financing Fall Short

A recent assessment by international authorities has revealed that Macedonia still lags behind in its efforts to combat money laundering and terrorist financing.

Shortcomings Remain

While significant progress has been made in some areas, there are still several shortcomings that need to be addressed. One of the main concerns is the lack of awareness among financial institutions about the importance of identifying beneficial owners and preventing transactions with countries that have not implemented adequate anti-money laundering measures.

Limited Success in Reporting Suspicious Transactions

The report also highlights the limited success in reporting suspicious transactions by non-banking financial sectors, with only a small percentage of reports submitted to the relevant authorities. Furthermore, there are concerns about the lack of direct and unconditional obligation for banks to report suspicious transactions, which may lead to a lack of transparency and accountability.

Ineffective Enforcement

In addition, the assessment found that sanctions imposed on financial institutions for AML/CTF breaches are very limited, with only a few instances of fines being levied in practice. This lack of effective enforcement is a significant concern, as it may undermine the overall effectiveness of the country’s anti-money laundering regime.

Designated Non-Financial Businesses and Professions (DNFBPs)

The report also looked at DNFBPs, such as casinos, real estate agents, notaries, lawyers, and accountants. While some progress has been made in terms of technical compliance with FATF recommendations, there are still concerns about the lack of awareness among these professionals about the importance of identifying beneficial owners and preventing transactions with countries that have not implemented adequate anti-money laundering measures.

Risk-Based Approach to Customer Due Diligence

The assessment also found that DNFBPs do not apply a risk-based approach to customer due diligence, and there is a lack of reporting by these sectors to the relevant authorities. This lack of transparency and accountability is a significant concern, as it may undermine the overall effectiveness of the country’s anti-money laundering regime.

Recommendations

Overall, while Macedonia has made some progress in combating money laundering and terrorist financing, there are still several areas that need improvement. The country must take swift action to address these concerns and ensure that its anti-money laundering regime is effective and robust.