Turkey’s Anti-Money Laundering and Combating the Financing of Terrorism Efforts Receive Mixed Assessment from Global Financial Regulators

Global financial regulators have assessed Turkey’s anti-money laundering (AML) and combating the financing of terrorism (CFT) efforts as “largely compliant” with international standards, according to a recent report. The report, which evaluated Turkey’s implementation of the Financial Action Task Force (FATF) Recommendations, found that the country has made significant progress in certain areas but still needs to improve in others.

Strengths

• Turkey received high ratings for its efforts to assess risk and apply a risk-based approach.
• National cooperation and coordination mechanisms were also highly rated.
• The country’s laws and regulations related to money laundering and terrorist financing, including the confiscation of proceeds from criminal activities and the freezing of assets linked to terrorism, scored well.

Areas for Improvement

• Turkey received lower ratings in areas such as:
  • Financial institution secrecy laws
  • Record-keeping requirements for financial institutions
  • Reporting of suspicious transactions
• The country also failed to fully implement certain regulations related to:
  • Correspondent banking
  • Money or value transfer services
  • Wire transfers

Recommendations for Improvement

The report highlighted several areas where Turkey needs to improve its AML/CFT framework, including:

• Regulation and supervision of financial institutions and designated non-financial businesses and professions (DNFBPs)
• Transparency and beneficial ownership requirements for legal persons and arrangements