Financial Crime World

Montenegro Lags Behind in Combating Money Laundering and Terrorism Financing

A recent evaluation has revealed that Montenegro is falling short in its efforts to combat money laundering and terrorism financing. Despite making some progress in criminalizing these activities, the country still fails to meet international standards.

Shortcomings in Laws and Regulations

  • Montenegro’s laws do not explicitly criminalize the financing of terrorism, despite being a signatory to several international conventions.
  • The country relies on generic provisions related to aiding and abetting to prosecute such offenses.
  • There is no obligation to report suspicions of terrorism financing.

Weaknesses in Record-Keeping Requirements

  • Montenegro’s record-keeping requirements only require the keeping of records for five years, whereas the internationally required standard is 10 years.
  • There is no provision for seizing bank accounts suspected of being linked to criminal activity.

Inadequate Confiscation and Seizure Powers

  • Montenegro’s laws do not provide for the confiscation of proceeds from crime or property used to finance terrorism.
  • The country lacks provisions for seizing assets suspected of being linked to terrorism, including money and property intended to be used in acts of terrorism.

Recommendations

  • Adopt a specific provision on terrorist financing in the new Criminal Code.
  • Include provisions allowing for the confiscation of money intended to be used for acts of terrorism.
  • Establish a Financial Intelligence Unit (FIU) with adequate resources and powers to retrieve information from databases, request additional information, and forward compiled data to law enforcement authorities.

Additional Measures

  • Put in place complete provisions allowing for the seizure and freezing of assets suspected of being linked to terrorism.
  • Give authorities the power to freeze without delay the assets of individuals or organizations designated by the UN Security Council resolutions.

Conclusion

Montenegro must take immediate action to strengthen its anti-money laundering and counter-terrorism financing regime to meet international standards. Failure to do so may lead to serious consequences, including reputational damage and increased risk of being delisted from the Financial Action Task Force (FATF) grey list.