Former Yugoslav Republic of Macedonia Prohibits Use of Third Parties in Financial Transactions

The Former Yugoslav Republic of Macedonia has taken significant steps to strengthen its anti-money laundering (AML) and combating the financing of terrorism (CFT) regime, according to a report by international financial authorities.

Progress Made

A recent report highlights several key areas where the country has made progress in implementing AML/CFT measures. One notable development is the prohibition on the use of third parties in financial transactions.

Key Developments

• Reporting entities are required to keep records of client and beneficial owner information for at least 10 years after a transaction has been completed.
• Entities performing wire transfers must identify and verify the identity of both the sender and recipient.
• The country’s AML/CFT law now covers all designated non-financial businesses and professions (DNFBPs) listed in the FATF Glossary, except for internet casinos.

Areas for Improvement

However, the report identified several areas where improvement is needed:

• Notaries, lawyers, and accountants have lower awareness of the concept of beneficial ownership and politically exposed persons (PEPs).
• DNFBPs do not apply a risk-based approach to customer due diligence (CDD).
• No TF-related suspicious transaction reports (STRs) have been submitted by these sectors.

Supervisory Authorities’ Efforts

The country’s supervisory authorities have proposed an alignment procedure before submitting requests for criminal procedures. Sanctions are provided both for legal entities and responsible persons, with fines ranging from €5,000 to €10,000 in denar counter-value.

Conclusion

While significant progress has been made, further efforts are needed to ensure that the country’s AML/CFT regime is effective in preventing money laundering and terrorism financing.