Armenia’s Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) System: Areas for Improvement

Overview

A recent report assesses Armenia’s compliance with AML/CFT regulations, highlighting both strengths and areas for improvement in the country’s system.

Effective Characteristics

• The Armenian Financial Monitoring Center (FMC) has been active in exchanging information with foreign counterparts.
• DNFBPs have adequate systems and procedures in place for customer due diligence.

Areas for Improvement

Limited Law Enforcement Authority

• Law enforcement authorities have limited scope for informal exchange of information due to a lack of policy on actively identifying ML/FT cases.

Beneficial Ownership Information

• The State Register has introduced rules for beneficial ownership information, but there is no formal mechanism for monitoring its adequacy, accuracy, or currency.

Priority Actions

• Expand the assessment of ML threats: Consider the magnitude and significance of overall criminal activity, including corruption, cross-border illicit flows, and trends in ML.
• Deepen analysis of vulnerabilities: Identify weaknesses in DNFBPs, abuse of legal persons, corruption, shadow economy, and extensive use of cash.
• Enhance law enforcement capabilities: Use intelligence generated by the FMC to develop evidence and trace criminal proceeds, accompanied by specialized training on using FMC intelligence products.
• Develop a national law enforcement policy: Set out a co-ordinated approach to investigate and prosecute ML offenses.

Conclusion

While Armenia has made progress in implementing AML/CFT regulations, there are several key areas that need attention to further strengthen its system. Addressing these priorities will be essential for enhancing the country’s overall effectiveness in combating money laundering and terrorism financing.