Morocco Enhances Counter-Terrorist Financing Measures, but Lags in Understanding Money Laundering Risks
Rabat, Morocco - The Moroccan government has made significant strides in combating terrorist financing, but its understanding of money laundering risks remains limited, according to a recent assessment by the Middle East and North Africa Financial Action Task Force (MENAFATF).
Assessment Highlights
The assessment, conducted in 2019, highlighted several areas where Morocco excelled, including:
- Coordination among national authorities
- Ability to collect and analyze financial intelligence
However, it also identified several weaknesses, including:
- Lack of understanding of money laundering risks
- Need for enhanced resources and capabilities
National Risk Assessment Process
One of the key findings was that Morocco’s National Risk Assessment (NRA) process, initiated in 2016, helped to collectively consider ML/TF risks by engaging all stakeholders. However, the NRA has not been adopted by official authorities, and its findings have not been disseminated to anti-money laundering (AML)/counter-terrorism financing (CFT) authorities or financial institutions.
Understanding of Terrorist Financing Risks
The assessment noted that Morocco’s understanding of terrorist financing risks is good, but it lacks analysis of how terrorist entities misuse non-profit organizations. The country’s National Authority for the Prevention and Fight Against Money Laundering (UTRF) was found to be the focal point of the national AML system, but its board does not have a clear policy on combating the financing of proliferation of weapons of mass destruction.
Financial Intelligence
UTRF plays a key role in collecting, analyzing, and disseminating financial information. However, the number of disseminated terrorist finance cases was found to be low, and there is no feedback mechanism between UTRF and reporting entities or the public prosecution service.
Investigation and Prosecution of Money Laundering Offenses
The assessment highlighted weaknesses in Morocco’s investigation and prosecution of money laundering offenses. The country’s National Security Judiciary Police (NSJP) created an office for combating economic and financial criminality, but investigators lack expertise in financial investigation techniques and do not have a sufficient knowledge of types of money laundering cases.
Efforts to Improve AML/CFT Regime
Despite these challenges, the Moroccan government has made efforts to improve its AML/CFT regime. UTRF relies on government and non-governmental sources to obtain information and uses software to analyze suspicious transaction reports (STRs) received from reporting entities.
Conclusion
The MENAFATF assessment provides a comprehensive overview of Morocco’s AML/CFT regime, highlighting areas where the country excels and those that require improvement. The report serves as a valuable tool for policymakers, financial institutions, and other stakeholders seeking to understand the country’s efforts to combat money laundering and terrorist financing.
Recommendations
To improve its AML/CFT regime, Morocco should:
- Enhance its understanding of money laundering risks
- Develop policies on combating the financing of proliferation of weapons of mass destruction
- Improve investigation and prosecution of money laundering offenses
- Establish a feedback mechanism between UTRF and reporting entities or the public prosecution service
By addressing these challenges, Morocco can strengthen its efforts to combat money laundering and terrorist financing.