Financial Crime World

Strengthening Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) Framework in North Macedonia

The evaluation report on North Macedonia’s AML/CFT framework highlights significant improvements since the last round of evaluations. However, technical shortcomings in the legal framework, inadequate analysis in certain sectors, and concerns about strategic coordination remain areas of concern.

Key Findings

  • Progress in Strengthening AML/CFT Framework: Significant improvements have been made since the last evaluation.
  • Technical Shortcomings in Legal Framework: There are still technical shortcomings that need to be addressed.
  • National Risk Assessment (NRA): The NRA and other sectorial risk assessments have been conducted, but further analysis is needed for certain sectors such as construction and informal economy.

Challenges and Shortcomings

  • Interagency Council for Combating ML/TF: Concerns about the effectiveness of strategic coordination on combating money laundering (ML)/terrorism financing (TF).
  • Limited Use of Financial Intelligence: Financial intelligence from the FIU has been used to a limited extent to develop evidence and launch investigations in relation to ML/TF and underlying predicate offenses.

Recommendations

Complete Implementation of UN TFS

  • Completing the implementation of UN TFS on TF and PF is essential for strengthening North Macedonia’s AML/CFT framework.
  • This will enhance the country’s ability to prevent and combat terrorism financing.

Address Gaps in Definition of TF Offense

  • The definition of TF offense and related measures need to be addressed to improve the effectiveness of North Macedonia’s AML/CFT framework.
  • This will ensure that the country is in compliance with international standards and best practices.

Ensure Full Coverage of Bearer Negotiable Instruments

  • Ensuring full coverage of bearer negotiable instruments within the cross-border regime is crucial for preventing money laundering and terrorism financing.
  • This will strengthen North Macedonia’s AML/CFT framework and improve its effectiveness.

Improve Supervision of DNFBPs, FIs, and VASPs

  • Improving supervision of designated non-financial businesses and professions (DNFBPs), financial institutions (FIs), and virtual asset service providers (VASPs) is essential for preventing money laundering and terrorism financing.
  • This will strengthen North Macedonia’s AML/CFT framework and improve its effectiveness.

Strengthen Strategic Coordination on Combating ML/TF

  • Strengthening strategic coordination on combating money laundering (ML)/terrorism financing (TF) is crucial for improving the effectiveness of North Macedonia’s AML/CFT framework.
  • This will ensure that the country is in compliance with international standards and best practices.

Conclusion

The evaluation report highlights significant progress made by North Macedonia in strengthening its AML/CFT framework. However, technical shortcomings in the legal framework, inadequate analysis in certain sectors, and concerns about strategic coordination remain areas of concern. Addressing these challenges and implementing the recommended actions will further enhance North Macedonia’s AML/CFT framework and improve its effectiveness in preventing and combating money laundering and terrorism financing.