Financial Crime World

Title: Tunisia’s Financial Regulations: An Overview of Compliance with FATF Recommendations

In the global fight against financial crime, the Financial Action Task Force (FATF) sets the international standard for combating money laundering, terrorist financing, and other related threats. This article provides an overview of Tunisia’s progress towards implementing the FATF Recommendations, as outlined in the Mutual Evaluation Report from 2016.

FATF Assessments and Ratings

The FATF assesses countries based on their level of adherence to the Recommendations, which consist of the following ratings:

  • Compliant (C): The country fully understands and implements the Recommendation.
  • Largely Compliant (LC): The country has significant systems in place to meet the standards but may require some improvements.
  • Partially Compliant (PC): The country has initiated steps towards implementation but more work is needed.
  • Non-Compliant (NC): The country has not taken sufficient steps to address the issues raised.

Tunisia’s Progress and Challenges

Tunisia has made advancements and faced challenges in several critical areas:

  1. Partially Compliant (PC): R.1, R.2, R.6, R.8, R.10, R.11, R.12, R.13, R.15, R.18, R.19, R.20, R.21, R.22.1, R.22.2
  2. Compliant (C): R.3, R.5, R.20, R.21
  3. Largely Compliant (LC): R.4, R.19
  4. Non-Compliant (NC): R.9

Progress in Compliant and Largely Compliant Areas

Tunisia has achieved a ‘Compliant’ rating in the following areas:

  • Money laundering offense (R.3)
  • Terrorist financing offense (R.5)

Although Tunisia has made progress in specific areas, it still faces challenges in other sectors.

Areas Requiring Improvement

Tunisia has partially addressed the following Recommendations:

  • R.4 – Confiscation and Provisional Measures: Largely Compliant
  • R.6 – Targeted financial sanctions related to terrorism & terrorist financing: Partially Compliant
  • R.8 – Non-profit organizations: Largely Compliant
  • R.9 – Financial institution secrecy laws: Non-Compliant

Significant improvements are needed in areas like non-profit organizations and financial institution secrecy laws to become fully compliant with FATF regulations.

Strengths and Strides in Other Areas

Tunisia has recorded progress in several other areas:

  1. Customer due diligence (R.10): Partially Compliant
  2. Record keeping (R.11): Compliant
  3. Politically exposed persons (R.12): Partially Compliant
  4. Correspondent banking (R.13): Largely Compliant
  5. New technologies (R.15): Partially Compliant
  6. Internal controls and foreign branches and subsidiaries (R.18): Partially Compliant
  7. Higher-risk countries (R.19): Partially Compliant
  8. Reporting of suspicious transactions (R.20): Compliant
  9. Tipping-off and confidentiality (R.21): Compliant
  10. Designated non-financial businesses and professions (DNFBPs) – Customer due diligence (R.22.1): Partially Compliant
  11. Designated non-financial businesses and professions (DNFBPs) – Other measures (R.22.2): Partially Compliant

As the Tunisian government continues its reforms and improvements, ongoing FATF assessments will be crucial in ensuring the country remains committed to combatting financial crimes and maintaining an effective regulatory framework.