Financial Crime World

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San Marino’s Efforts in Combating Money Laundering and Terrorist Financing

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A recent assessment by the Financial Action Task Force (FATF) has highlighted San Marino’s efforts in combating money laundering (ML) and terrorist financing (TF). While the country’s legal framework enables effective investigation and prosecution of ML, there are still areas for improvement.

Investigation and Prosecution of Money Laundering

The FATF assessment noted that San Marino’s authorities conduct complex financial investigations to address ML risks, and most ML convictions involve foreign predicates. However, sentences imposed on natural persons may not always be effective in deterring future offenses.

Challenges with Sentencing

  • Ineffective deterrent: Sentences imposed on natural persons may not always be effective in deterring future offenses.
  • Room for improvement: San Marino’s authorities should improve the effectiveness of sentences imposed on natural persons to prevent and detect financial crimes.

Terrorist Financing

Regarding TF, San Marino has recently amended its national legislation to comply with FATF recommendations. The Committee for Restrictive Measures (CRM) has been established to coordinate efforts in this field. However, banks and other financial institutions (FIs) may need to improve their screening processes to detect funds related to UN designations.

Challenges with Screening Processes

  • Improvement needed: Banks and other FIs should enhance their screening processes to detect funds related to UN designations.
  • Further guidance required: San Marino’s authorities should provide further guidance to banks and other FIs on their TF-related obligations.

Private Sector Participants

The assessment also highlighted the importance of identifying beneficial ownership structures and freezing assets without delay as part of the implementation of PF TFS. While some private sector participants are aware of these obligations, there is a need for further guidance and training.

Challenges with Beneficial Ownership Structures

  • Identification required: San Marino’s authorities should identify beneficial ownership structures.
  • Assets to be frozen: Assets should be frozen without delay as part of the implementation of PF TFS.
  • Training and guidance needed: Private sector participants require further guidance and training on their obligations.

Conclusion

In conclusion, San Marino has made significant progress in combating ML and TF, but there are still areas that require attention and improvement. The country’s authorities should continue to work towards implementing effective measures to prevent and detect financial crimes.

Key Findings

  • Effective investigation and prosecution: San Marino’s legal framework enables effective investigation and prosecution of money laundering.
  • Most convictions involve foreign predicates: Most money laundering convictions involve foreign predicates.
  • DNFBPs require guidance: DNFBPs may require further guidance on their TF-related obligations.
  • Banks need to improve screening processes: Banks and other FIs need to improve their screening processes to detect funds related to UN designations.
  • Beneficial ownership structures should be identified: Beneficial ownership structures should be identified, and assets frozen without delay as part of the implementation of PF TFS.

Recommendations

  1. Improve sentencing effectiveness: Improve the effectiveness of sentences imposed on natural persons.
  2. Provide guidance to DNFBPs: Provide further guidance to DNFBPs on their TF-related obligations.
  3. Enhance screening processes: Enhance screening processes by banks and other FIs to detect funds related to UN designations.
  4. Identify beneficial ownership structures: Identify beneficial ownership structures and freeze assets without delay as part of the implementation of PF TFS.
  5. Provide training and guidance: Provide training and guidance to private sector participants on their obligations.

Next Steps

  1. Implement effective measures: The San Marino authorities should implement effective measures to prevent and detect financial crimes.
  2. Further assessments: Further assessments and monitoring will be necessary to ensure progress and identify areas for improvement.