Financial Crime World

Suspicious Transactions Rampant in Former Yugoslav Republic of Macedonia

Plagued by Significant Number of Suspicious Transactions

A recent report has revealed that the former Yugoslav Republic of Macedonia (FYROM) is facing a significant number of suspicious transactions, including those related to terrorist financing.

Positive Sign: Increase in Reports of Suspicious Transactions

According to the report, there has been a noticeable increase in reports of suspicious transactions (STRs), which indicates the effectiveness of the reporting system. However, the report also highlighted several deficiencies in FYROM’s anti-money laundering and combating the financing of terrorism (AML/CFT) measures.

Deficiencies in AML/CFT Measures

  • Lack of definition for the beneficial owner, making it difficult to verify customer identities
  • No requirement for financial institutions to establish the source of wealth for customers who are politically exposed persons (PEPs)
  • Enhanced CDD measures do not extend to the beneficial owner

Record-Keeping Requirements and Supervision Deficiencies

  • The obligation to maintain records on transactions and identification data is still missing
  • The requirement to provide information on a timely basis to supervisory authorities is also absent
  • Deficiencies in supervision, including issues regarding the application of fit and proper criteria and effectiveness

Transparency of Wire Transfers

While there has been an improvement in the transparency of wire transfers since the last evaluation, further implementation is still required.

Casinos and Financial Sector

  • Lack of legal and regulatory measures to prevent criminals or their associates from holding or being the beneficial owner of a significant or controlling interest in casinos
  • The country’s central bank has not yet implemented necessary legal and regulatory measures to prevent money laundering and terrorist financing in the financial sector

Conclusion: More Work Needed to Strengthen AML/CFT Regime

While there have been some improvements since the last evaluation, there is still much work to be done to strengthen FYROM’s AML/CFT regime.