Financial Crime World

Oman’s Terrorist Financing Risks Under Scrutiny

A recent evaluation by international experts has raised concerns about Oman’s efforts to combat terrorist financing and money laundering. The assessment team, comprising members from the Middle East and North Africa Financial Action Task Force (MENAFATF) and the Financial Action Task Force (FATF), found that while Oman has a robust anti-money laundering (AML) and combating the financing of terrorism (CFT) system in place, there are still significant gaps and shortcomings.

Assessment Highlights

  • Oman’s AML/CFT law, enacted last year, is robust but has yet to be fully implemented.
  • The country’s legal framework for money laundering is incomplete, with several key offenses not covered, including the concealment or disguise of property.
  • There were low numbers of convictions for money laundering, hindering the effectiveness of the system.

Combating Terrorist Financing

  • Oman has criminalized the financing of terrorism, but there have been no investigations, prosecutions, or convictions related to this offense.
  • The country lacks laws and procedures in place to implement United Nations Security Council Resolution 1373.
  • Oman has no laws or procedures in place to implement most UN resolutions on counter-terrorism.
  • There are gaps in the legal framework for combating terrorist financing, including a lack of procedures for freezing terrorist assets.

Law Enforcement Capacity

  • Law enforcement agencies, including the Financial Intelligence Unit (FIU) and the Royal Oman Police, were found to be understaffed and under-resourced.
  • Improved capacity and experience are needed in analyzing suspicious transaction reports.

Supervisory Agencies

  • The Central Bank of Oman and Capital Markets Authority have been criticized for low levels of corrective measures applied to financial institutions.

Conclusion and Recommendations

  • While Oman has made progress in implementing AML/CFT measures, there is still much work to be done to effectively combat terrorist financing and money laundering.
  • The country was urged to expedite the finalization of its Executive Regulation, update its legal framework, and improve law enforcement capacity and effectiveness.