Assessment of the Syrian Arab Republic’s Anti-Money Laundering (AML) and Combating Financing of Terrorism (CFT) Efforts

Introduction

The Financial Action Task Force (FATF) has issued a report assessing the Syrian Arab Republic’s AML/CFT framework against its Recommendations. The report highlights several deficiencies in the Syrian AML/CFT regime, while also acknowledging efforts made by authorities to address these issues.

Deficiencies in the Syrian AML/CFT Regime

The report identifies the following key shortcomings:

1. Absence of Laws and Regulations Requiring Financial Institutions (FIs) to Provide Customer Identification Records

While there are some provisions allowing FIs to share customer information with competent authorities, there is no clear legislative requirement for them to do so.

The report notes that while there are some provisions requiring FIs to verify the identity of customers and legal persons, these requirements are not comprehensive enough to cover all situations, particularly those involving dealings through agents or legal persons.

3. Absence of Legislative Provision Obligating Insurance Companies, Exchange Institutions, and Other Financial Institutions (Other Than Banks) to Perform Certain Customer Due Diligence Measures

Specifically, the report notes that these entities are not required to verify the identity of beneficial owners, identify natural persons owning legal persons or exercising ultimate effective control over them, or perform ongoing supervision operations.

Efforts Made by Authorities to Address Deficiencies

Despite the identified shortcomings, the report highlights that the Syrian authorities have made efforts to address these issues through legislative and regulatory amendments:

Executive Instructions of Legislative Decree No. 33 for 2014: These instructions require FIs to determine the owner of the economic right in a manner that ensures they have taken reasonable measures to verify the identity of such persons.
Decision No. 15 for 2015: This decision requires the reporting officer to access all customer data and documents, including those acquired during due diligence processes, as well as to identify and verify the identity of customers with numbered accounts in banks.

Conclusion

While there are still some deficiencies in the Syrian AML/CFT regime, the authorities have made efforts to address these issues through legislative and regulatory amendments. However, further improvements are necessary to ensure that the regime is fully compliant with the FATF Recommendations.