Portugal Faces High Risk of Money Laundering and Terrorism Financing

Inadequate Combating Efforts Identified by International Authorities

Lisbon, Portugal - A recent risk assessment report has deemed Portugal’s ability to combat money laundering (ML) and terrorist financing (TF) inadequate. The report highlights significant vulnerabilities in the country’s financial system, placing it at high risk of ML and TF.

High Risk of Money Laundering and Terrorism Financing

According to the report, 60% of entities evaluated are at a “high” or “medium-high” risk of ML and TF. This is due to the increasing sophistication of organized criminal structures, which use specialized cells to commit crimes and launder money. Tax fraud, drug trafficking, and corruption are identified as the main predicate offenses linked to ML.

Key Findings

• Organized criminal structures have become increasingly sophisticated in committing crimes and laundering money.
• Tax fraud is the most common type of crime linked to ML.
• Non-profit organizations are still under assessment for their ML/TF risk.
• Legislative, operational, and political factors, as well as geographic and demographic context, contribute to Portugal’s vulnerability to TF and PF.

Recommendations

To address these threats, Portuguese authorities have been tasked with:

• Setting out measures to strengthen anti-money laundering (AML) and combating the financing of terrorism (CFT) controls.
• Implementing enhanced or simplified measures proportionate to the risk.
• Allocating human, financial, and material resources to mitigate identified vulnerabilities.

Assessment Conducted by Range of Authorities

The assessment was conducted by a range of authorities, including:

• Sectoral supervisory bodies
• Supreme Judicial Council
• Financial Intelligence Unit (FIU)
• Police authorities
• Other relevant entities

Report Expected to Inform Policy Development

The report is expected to inform the development of policies and strategies to combat ML and TF in Portugal.