Financial Crime World

Macao’s Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) Measures: Assessment and Recommendations

Macao, China has made significant efforts in recent years to combat money laundering (ML) and terrorist financing (TF). However, there are still areas where improvement is needed to strengthen its anti-money laundering and counter-terrorist financing measures.

Strengths of Macao’s AML/CFT Measures

Effective Laws and Regulations

  • Macao has implemented various laws and regulations to combat ML and TF.
  • The authorities have enhanced procedures and guidance in line with the strategic plan.
  • GIF’s central policy role and strategic intelligence supports supervisors to monitor their sectors and raises private sector risk awareness.

Weaknesses of Macao’s AML/CFT Measures

Areas for Improvement

  • Private Sector Understanding: Private sector understanding of ML risks is generally sound but needs improvement for certain sectors (junket promoters, real estate, dealers of precious stones and metals).
  • LEA Investigations: LEA investigations of ML do not match the risk profile and demonstrate a lack of a risk-based approach in practice.
  • Information Gaps: There are information gaps, including low STR reporting for high-risk junket and real estate sectors, and limited cross-border disclosure or declaration system.
  • LEA Secrecy Protocols: LEA secrecy protocols limit GIF’s ability to include broader criminal intelligence on common regional crime and ML risks in strategic analysis.

Recommendations for Improvement

Key Recommendations

  1. Improve Private Sector Understanding: Improve private sector understanding of ML risks, particularly for certain sectors.
  2. Enhance LEA Investigations: Enhance LEA investigations of ML to match the risk profile and adopt a risk-based approach in practice.
  3. Improve Information Sharing: Improve information sharing among GIF, supervisors, and LEA to more effectively use financial and criminal intelligence.
  4. Increase Resources for GIF: Increase resources for GIF to meet its combined FIU, policy development, and coordination roles effectively.

Key Areas for Improvement

  • Risk-Based Approach: Implement a risk-based approach for ML investigations
  • Information Gaps: Address information gaps (STR reporting, cross-border disclosure or declaration system)
  • Limited LEA Secrecy Protocols: Limit LEA secrecy protocols to allow broader criminal intelligence on common regional crime and ML risks in strategic analysis.
  • Prosecutorial Resources: Enhance prosecutorial resources and evidentiary requirements.