Financial Crime World

Title: Romania’s Financial Crimes Landscape: AML/CFT Compliance and Trends

Executive Summary

  • This article provides an overview of Romania’s Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) measures based on the Fifth Round Mutual Evaluation Report by the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL).
  • The report sheds light on Romania’s compliance with the Financial Action Task Force (FATF) recommendations and the effectiveness of its AML/CCT system.
  • It also provides recommendations for strengthening the system.

Key Areas of Concern

Understanding Money Laundering Risks

  • Fair understanding of money laundering risks
  • Developing understanding and strategies for terrorist financing risks

Adequacy of Resources

  • Inadequate financing for the Financial Intelligence Unit

International Cooperation

  • Insufficient international cooperation

Capacity Building

  • Increasing capacity within law enforcement and prosecution agencies
  • Developing a comprehensive AML/CFT strategy
  • Addressing issues within the non-profit sector

Domestic Predicate Offenses and Organized Crime

  • Prevalent domestic predicate offenses: tax evasion, corruption, fraud, smuggling, human trafficking, drug trafficking
  • Organized criminal groups’ (OCGs) contribution to these crimes and money laundering

Progress and Challenges

Improvements

  • Strengthening legal and regulatory framework
  • Conducting first comprehensive National Risk Assessment (NRA)
  • Improving access to financial intelligence

Ongoing Challenges

  • Effective international cooperation
  • Addressing risks in the non-profit sector
  • Challenges posed by virtual assets and virtual asset service providers

Romania’s Financial Sector

Financial Sector Overview

  • Dominated by banks
  • Underdeveloped non-bank sector

Use of Cash and International Cooperation

  • Prevalent use of cash
  • Sound legal framework for international cooperation
  • Lack of reliable data and statistics hindering the effectiveness demonstration

Conclusion

  • Significant progress in some areas
  • Ongoing challenges
  • Continued improvements needed for effective AML/CFT measures and combating financial crimes.