Financial Crime World

San Marino’s Efforts Against Money Laundering and Terrorist Financing: A Mixed Bag

San Marino, a small European nation, has made significant progress in combating money laundering (ML) and terrorist financing (TF). However, its efforts are not without their challenges. According to the latest report by the Financial Action Task Force (FATF), San Marino’s legal framework is well-equipped to investigate and prosecute ML cases, with many convictions resulting from investigations involving foreign predicates.

Positive Developments

  • San Marino’s authorities have demonstrated a strong commitment to combating ML and TF, with several high-profile investigations and convictions in recent years.
  • The country has taken steps to improve its anti-money laundering (AML) regime, including the establishment of a dedicated Financial Intelligence Unit (FIA).
  • The report notes that San Marino’s legal framework is well-equipped to investigate and prosecute ML cases, with many convictions resulting from investigations involving foreign predicates.

Areas for Improvement

  • Non-profit organizations (NPOs) remain vulnerable to TF abuse, and more needs to be done to educate them on their obligations under anti-money laundering laws.
  • The report identifies concerns about the effectiveness of San Marino’s sanctions regime, with some banks and other financial institutions struggling to implement effective screening procedures for customers against UN designations.
  • Some designated non-financial businesses and professions (DNFBPs) lack a clear understanding of their obligations under anti-money laundering laws.

Terrorist Financing

  • San Marino has taken steps to improve its terrorist financing regime, including the establishment of a Committee for Restrictive Measures (CRM) to coordinate efforts against TF.
  • However, the report notes that no criminal justice, regulatory or other measures have been employed to disrupt TF since the country’s last assessment.

Conclusion

While San Marino has made progress in combating ML and TF, more work is needed to address remaining vulnerabilities and ensure the effective implementation of its anti-money laundering and anti-terrorist financing regimes.