Financial Crime World

Title: Tunisia’s Financial Regulations: An Assessment of Anti-Money Laundering and CFT Compliance by MENAFATF

Overview

The Middle East and North Africa Financial Action Task Force (MENAFATF) has published an executive summary of its Mutual Evaluation Report on Tunisia’s adherence to Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) measures. This analysis, prepared by the World Bank, evaluates Tunisia’s compliance with the FATF 40+9 Recommendations using the FATF methodology of 2004.

Context of Tunisia’s Financial Sector

Tunisia, with a GDP of US$28.7 billion in 2005, has a comparatively developed financial sector. The country, however, has a divided economy, with an export-focused offshore sector and a domestic onshore sector, and strict currency control arrangements. Despite its high regulatory environment, family groups and cash transactions remain a challenge.

Key Findings: Strengths and Challenges

AML/CFT Measures: Strengths

  • Comprehensive legal framework: Tunisia has laws and regulations for freezing, seizing, and confiscating assets related to AML/CFT offenses.
  • Liability of legal persons and CTAF: Law 2003-75 includes provisions for holding legal persons accountable for AML/CFT offenses and establishes the Tunisian Financial Analysis Commission (CTAF), a financial intelligence unit.

AML/CFT Measures: Areas for Improvement

  • Asset freezing: Tunisia lacks administrative arrangements for freezing assets as required by Resolutions 1267 and 1373.
  • CTAF: The CTAF requires secure premises, additional staff, and expertise to effectively receive, analyze, and disseminate suspicious transaction reports.
  • Prevention and detection pillars: The implementation of the prevention and detection pillars under Law 2003-75 has not yet begun.

Recommendations for Improvement

  • Risk analysis: Develop a more comprehensive analysis of criminal activities based on statistical data to create an AML/CFT risk profile.
  • Capacity building: Create a unit within the Legal and Judicial Studies Center to carry out risk assessments to enhance capacity.
  • Implementation priorities: Adopt a more aggressive and coordinated approach to tackle money laundering and terrorist financing with a focus on prioritizing the banking sector, followed by the securities market and insurance market.

Conclusion: Further Actions towards Effective Implementation

To enhance the effective implementation of the AML/CFT framework and strengthen Tunisia’s financial system, the authorities are encouraged to:

  • Accelerate progress
  • Ensure sufficient resources and expertise for relevant institutions
  • Address the identified weaknesses and improve the overall regulatory environment.