Financial Crime World

Title: Portugal Cracks Down on Financial Crime: An Overview of Regulations and Authorities

Portugal, a member of the Financial Action Task Force (FATF) since 1991, is consistently committed to preventing money laundering, terrorism financing, and the financing of weapons of mass destruction. This article provides an overview of Portugal’s regulatory framework and key authorities involved in combating financial crimes.

Financial Intelligence Unit (FIU-Portugal)

The country’s Financial Intelligence Unit (FIU-Portugal) plays a crucial role in the fight against financial crimes. Operating under the Ministry of Economy and Digital Transition, FIU-Portugal collects, analyzes, and distributes financial intelligence information to law enforcement and regulatory authorities.

Anti-Money Laundering and Countering Terrorist Financing Law

Portugal’s updated Anti-Money Laundering and Countering Terrorist Financing (AML-CTF) Law, effective January 1, 2022, further strengthens the country’s regulatory framework:

  • Beneficial Ownership Transparency: AML-CTF law enhances transparency by requiring businesses to register their beneficial owners with the Companies Registry.
  • Customer Due Diligence: The law reinforces customer due diligence measures, ensuring that businesses verify the identities of their clients and assess the risk of money laundering or terrorist financing.

Securities Market Commission (CMVM)

The Securities Market Commission (CMVM) is Portugal’s primary securities market regulator. The commission works closely with FIU-Portugal and other authorities:

  • Transparency and Security: CMVM ensures the transparency and security of Portugal’s financial markets by monitoring and investigating suspicious transactions.
  • Collaboration: The commission works with international regulatory bodies to prevent financial crimes within Portugal’s financial markets.

Central Bank of Portugal

The Central Bank of Portugal’s focus on consumer protection and the stability of the financial sector includes a strong anti-money laundering unit:

  • Partnership: The bank’s anti-money laundering unit collaborates with FIU and other authorities to detect and prevent financial crimes within the banking sector.

Terrorism Financing

Portugal’s terrorism financing regulations align with those of the European Union:

  • List of Terrorist Organizations and Individuals: Portugal follows the EU’s list of terrorist organizations and individuals.
  • Law Enforcement Coordination: Portuguese law enforcement agencies collaborate with their European and international counterparts to prevent and investigate terrorism financing cases.

Weapons of Mass Destruction Financing

Combating the financing of weapons of mass destruction is a top priority for Portugal:

  • International Collaboration: Portugal’s regulatory bodies work with international organizations like the FATF, INTERPOL, and the European Union to identify and investigate potential cases of financing these illicit activities.

Ongoing Challenges

Portugal continues to make progress in tackling financial crimes, but the latest FATF mutual evaluation report notes areas for improvement:

  • Strengthening the Criminal Justice Response: Enhancing the criminal justice response to financial crimes is crucial for effective enforcement.
  • Coordination among Government Agencies: Improved coordination and communication will help eliminate redundancies and streamline efforts to prevent financial crimes.
  • Risk-Based Approach: Adopting a risk-based approach to supervision and regulation allows authorities to allocate resources effectively and respond to evolving threats.

Portugal’s dedication to preventing financial crimes underlines its commitment to maintaining a stable, secure, and effective financial system. Regulatory bodies remain vigilant and proactive in the face of ongoing and evolving threats.

Sources