Myanmar Slammed onto Global “Blacklist” for Terrorism Financing
The Financial Action Task Force (FATF), a global watchdog, has added Myanmar to its list of high-risk countries that fail to combat money laundering and terrorist financing. This move follows years of warnings from FATF, which has urged the country to improve its anti-money laundering and combating the financing of terrorism regime.
Enhanced Due Diligence Measures
As a result, all jurisdictions are advised to apply enhanced due diligence measures when dealing with transactions involving Myanmar. These measures include:
- Obtaining additional identifying information on customers
- Verifying source of funds or wealth
- Conducting regular monitoring of business relationships
Downgrade from “Greylist” to “Blacklist”
Myanmar’s downgrade from the “greylist” to the “blacklist” comes despite promises from the country to improve its anti-money laundering and combating the financing of terrorism regime. The Central Bank of Myanmar has argued that it has experience meeting FATF standards in the past, having been removed from the list in 2016.
Impact on Companies
The impact of this blacklisting will be felt by companies operating in or doing business with Myanmar. Financial institutions processing payments with possible links to Myanmar should review and consider updating their compliance programs to mitigate risks associated with terrorism financing.
US Treasury’s Guidance
The US Treasury’s Financial Crimes Enforcement Network (FinCEN) has also issued a statement, noting the FATF designation and advising US financial institutions to continue consulting existing regulations and guidance on engaging with financial transactions in Myanmar. The Biden Administration appears to be taking a cautious approach, with no immediate plans to impose further sanctions.
Expert Advice
Companies operating in or doing business with Myanmar should seek expert advice on internal compliance, export controls, and sanctions. Clifford Chance has a team of experts available to help navigate the complexities of international finance and risk management.
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