Slovakia Tackles Financial Crimes with New Risk Assessment Guidance
Government Takes Steps to Strengthen Anti-Money Laundering and Countering Terrorism Financing (AML/CFT) System
The Slovak government has recently welcomed new methodological guidance for assessing money laundering and terrorist financing risks in the country’s banking sector. This move aims to bolster the AML/CFT system and provide a more effective framework for managing financial crimes.
Background
The Council of Europe developed the technical guidance paper, “Review and Guidance on the Methodology for ML/TF Risk Assessment of the Slovak Banking Sector,” in response to requests from key national stakeholders, including the National Bank of Slovakia. The paper was created after a thorough review of recent reports by MONEYVAL and the European Banking Authority (EBA), which highlighted the lack of a systematic sectoral risk assessment methodology in Slovakia.
Key Features of the Guidance Paper
- Systematic Sectoral Risk Assessment Methodology: The guidance paper provides concrete recommendations for developing a comprehensive methodology for conducting effective ML/TF risk assessments in the Slovak banking sector.
- International Best Practices: The report incorporates existing processes for entity-level risk assessment while also adopting international best practices from countries such as the UK, US, and Australia.
- Practical Annexes: The guidance paper includes practical annexes with suggested risk rating scales and model risk-based supervision processes.
Benefits of the Guidance Paper
The Slovak government has welcomed this support and committed to finalizing the methodology and conducting a sectoral risk assessment through a national coordination process. Once completed, the results will be instrumental in helping supervisors and banks manage their risks more effectively.
Conclusion
This initiative is part of a broader joint project between the European Union and the Council of Europe to enhance the effectiveness of the AML framework in Slovakia. By strengthening its AML/CFT system, Slovakia can better protect itself against financial crimes and maintain a stable and secure banking sector.