Financial Crime World

Tunisia’s Efforts to Improve Financial Transparency Fall Short

A recent report by a leading international financial institution has criticized Tunisia’s efforts to combat money laundering and terrorist financing (ML/TF), citing shortcomings in the country’s hiring practices and lack of transparency regarding beneficial ownership.

Compliance with Global Standards

The report assessed Tunisia’s compliance with global standards on Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT). While the country had made progress in some areas, it still fell short in others. Specifically:

  • Laws and regulations do not provide sufficient protections against tipping off suspects.
  • There is a lack of transparency regarding beneficial ownership of companies.

Concerns about Employee Competence

The report also highlighted concerns about the competence of employees hired by financial institutions:

  • No independent audit function to test the system.
  • Lack of training and experience in AML/CFT procedures.

Deficiencies and Recommendations

To address these deficiencies, the report recommends that Tunisia take several steps, including:

  • Requiring financial institutions to verify that their foreign branches and subsidiaries are implementing AML/CFT programs consistent with global standards.
  • Prohibiting employees from disclosing information about suspicious transactions.
  • Improving the system for maintaining accurate records of beneficial ownership, including:
    • Requiring companies to maintain information on the names and addresses of managers and members of control boards.
    • Requiring companies to maintain a register of shares and voting powers.

Response and Next Steps

In response to the report’s findings, Tunisian authorities have issued new laws and regulations aimed at improving financial transparency. However, the report notes that more work needs to be done to address the remaining deficiencies.

Conclusion

Tunisia’s efforts to improve its AML/CFT regime are ongoing, but there is still much work to be done to ensure compliance with global standards. The country must prioritize the implementation of effective measures to prevent tipping off and improve transparency regarding beneficial ownership. Until these issues are addressed, Tunisia will remain partially compliant with international standards on AML/CFT.