Financial Crime World

Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) Measures in Albania

Report by International Monetary Fund (IMF) for MONEYVAL

This report provides an assessment of Albania’s compliance with the FATF 40+9 Recommendations, highlighting key findings, recommendations, and areas for improvement.

Key Findings

High Risk of Money Laundering

  • Persistent organized crime and large informal economy: Albania has made significant progress in tackling money laundering (ML), but the risk remains high due to a history of organized crime and a large informal economy.
  • Cash-based transactions remain a problem: Cash-based transactions facilitate ML and circumvent preventive measures, making them a persistent challenge.

Risks of Financing Terrorism Activities

  • Albania is at risk regarding possible financing of terrorism activities, underscoring the need for enhanced CFT measures.

Inadequate Enforcement of Anti-Money Laundering Laws

  • Limited convictions: While Albania has fully criminalized ML, there have been few convictions, hindering effective use of provisions.
  • Demanding evidentiary requirements: Demanding evidentiary requirements have hindered the effective use of provisions.

Improvements in Financial Intelligence Unit (FIU) Processes

  • The Albanian FIU has improved its analytical processes, but the legal framework needs to be strengthened for operational independence.

Recommendations

Enhancing Operational Independence and Transparency

  • Strengthening the FIU’s operational independence: Ensuring that the FIU operates independently from political interference is crucial.
  • Clarifying the FIU’s responsibility to disseminate information: Clearly defining the FIU’s role in sharing suspicious transaction information will facilitate effective cooperation.

Improving Customer Due Diligence and Preventive Measures

  • Enhancing customer due diligence (CDD): Strengthening CDD measures, including identification of beneficial owners and CDD for foreign politically exposed persons (PEPs), is essential.
  • Improving implementation by designated non-financial businesses and professions (DNFBPs): Enhancing preventive measures among DNFBPs will help prevent ML.

Clarifying Supervisory Roles and Conducting Inspections

  • Clarifying the supervisory role of the FIU: Clearly defining the FIU’s supervisory responsibilities is necessary.
  • Undertaking inspections of the securities and insurance sectors: Regular inspections will ensure compliance with AML/CFT regulations.

Conclusion

The report provides a comprehensive assessment of Albania’s AML/CFT measures, highlighting key areas for improvement. Strengthening the legal framework, enhancing preventive measures, and improving enforcement are essential steps towards effectively combating money laundering and terrorism financing in Albania.