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Myanmar’s Money Laundering Fight Falls Short of Expectations
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A recent report has highlighted significant gaps in Myanmar’s efforts to combat money laundering and terrorist financing, particularly with regards to fit and proper supervision beyond banks.
Financial Intelligence Unit (MFIU) Assessment
The report assessed the country’s Financial Intelligence Unit (MFIU), which was initially rated “Partially Compliant” under Recommendation 29. The assessment identified several deficiencies, including:
- Lack of systems for operational analysis
- Reliance on manual processes
- Limited cooperation with foreign authorities
MFIU Progress and Limitations
While the MFIU has made some progress in completing strategic analysis reports, these efforts have been limited in scope and do not provide sufficient value-added insights. Additionally, the MFIU’s dual role as FIU and financial investigation team raises concerns about its capacity to carry out its functions freely.
Independence Concerns
The report criticizes the MFIU’s lack of independence when considering requests for information sharing with domestic or foreign authorities. The AML Law requires MFIU approval before sharing information, which may hinder effective cooperation.
Capacity and IT Systems
The assessment concludes that Criterion 29.4 remains partially met due to the MFIU’s limited capacity and IT systems to conduct operational analysis. While the MFIU has received support from the US Embassy to improve its analytical capabilities, it still lacks sufficient resources to effectively analyze financial data.
Secure Web-Based Database
Criterion 29.5 is mostly met, with the MFIU establishing a secure web-based database for information sharing with domestic and international partners. However, Myanmar’s failure to join the Egmont Group means that foreign FIUs cannot utilize the Egmont Secure Web system for sharing information.
Confidentiality Concerns
The report praises the MFIU’s efforts in maintaining confidentiality of information obtained during its duties, but notes that there are still deficiencies in this area, particularly with regards to foreign authorities.
Conclusion and Recommendations
Recommendation 29 remains a significant concern for Myanmar as it continues to work towards strengthening its anti-money laundering and terrorist financing regime. The report highlights the need for improved capacity, IT systems, and independence to effectively combat money laundering and terrorist financing.