Portugal’s Efforts to Combat Money Laundering and Terrorist Financing Yield Results
Lisbon - Portugal has made significant strides in combating money laundering and terrorist financing, according to recent reports from the Financial Action Task Force (FATF). The country’s robust anti-money laundering (AML) regulations have earned it a spot off FATF’s list of AML-deficient countries.
A History of Progress
Portugal’s journey to strengthen its AML framework began in 1991 when it joined the FATF. Since then, the country has implemented various measures to prevent money laundering and terrorist financing. In 2002, the Financial Intelligence Unit (FIU) was established to independently investigate financial crimes under the umbrella of the Portuguese Judicial Police.
Key Milestones
- 2004: Enactment of Law No. 11/2004 outlining specific requirements for AML compliance
- 2017: Introduction of new laws aimed at reducing cash transaction limits, establishing a national record of recipients for financial transactions, and requiring attorneys to report suspected instances of money laundering
Compliance and Evaluation
In a recent evaluation by FATF, Portugal was found to be compliant with 12 out of 40 recommendations and largely compliant with 22 others. This assessment reflects the country’s commitment to AML compliance and its efforts to prevent financial crimes.
Regulatory Framework
Portugal’s central bank, Banco de Portugal, serves as both the country’s central bank and financial regulator. The bank is responsible for implementing AML/CTF measures and has published guidelines for financial institutions to prevent money laundering and terrorist financing.
Impact and Recognition
The country’s efforts have not gone unnoticed. The US Department of State classified Portugal as a Jurisdiction of Primary Interest in its 2018 International Narcotics Control Strategy Report (INCSR). The report praised Portugal’s AML laws and enforcement mechanisms, stating that they adhere to global standards.
Wide-Ranging Impact
Portugal’s AML regulations apply to a wide range of sectors, including financial institutions and non-financial businesses. Entities are required to identify clients and conduct due diligence for business relationships or transactions exceeding specific thresholds. Suspicious transactions must be reported to the Central Department of Criminal Investigation and Prosecution and the FIU.
Consequences of Non-Compliance
Failure to comply with AML regulations can result in severe penalties, including imprisonment up to 12 years for individuals and fines for legal entities.
Conclusion
In conclusion, Portugal’s efforts to combat money laundering and terrorist financing have yielded significant results. The country’s robust AML framework has earned it a spot off FATF’s list of AML-deficient countries, and its commitment to compliance is evident in its legislative and regulatory measures. As the global financial landscape continues to evolve, Portugal remains committed to staying ahead of the curve and protecting its financial system from threats.