Financial Crime World

Title: Serbia and Montenegro: Addressing the Challenges in AML/CFT Regulations

MONEYVAL’s Assessment of Serbia and Montenegro’s AML/CFT Frameworks

  • Strasbourg, 21st January 2005 - MONEYVAL’s latest ROSC report for FATF Recommendations Against Money Laundering and the 8 Special Recommendations for Combating the Financing of Terrorism
  • Evaluation primarily focuses on legislative and regulatory frameworks, criminal justice measures, and financial institutions
  • Highlights several significant gaps in Serbia and Montenegro’s AML/CFT regime
  • Separate governments and parliaments, but also federal parliament
  • Divided regulatory frameworks due to the overlapping of powers

Challenges in Serbia

  • Absence of provisions for confiscation and seizure of funds related to terrorist financing
    • Weakening of legal tools for combating money laundering and terrorist financing

Challenges in Montenegro

  • Absence of a Financial Intelligence Unit (FIU)
    • Essential for coordinating AML/CFT efforts
    • Montenegro lacks specific legislation on financing terrorism
  • Lack of specific provisions for criminalizing financing of terrorism

Progress Towards Improvement

  • Serbian FIU’s membership in the Egmont Group
  • Montenegro’s establishment of an FIU

Importance of Addressing Identified Gaps

  • Strengthening AML/CFT frameworks
  • Improving capabilities to combat money laundering and terrorist financing

Serbia: Insufficient Confiscation and Seizure Provisions

  • Evaluators identified the absence of specific provisions on confiscating the proceeds of terrorist financing and seizing money intended for it
  • Weakens Serbia’s legal tools for combating money laundering and terrorist financing effectively

Montenegro: Absence of a Financial Intelligence Unit

  • Lack of a functional Financial Intelligence Unit (FIU) as a major concern
  • Montenegro has no specific legislation on financing terrorism, impeding Serbia’s efforts to combat money laundering and terrorist financing in the region

Criminalisation of Money Laundering and Financing of Terrorism

  • Both Serbia and Montenegro’s legislative frameworks lack specific provisions for the criminalisation of financing terrorism
  • While money laundering is criminalised, the absence of explicit references to financing terrorism hinders their efforts to address this issue effectively