Money Laundering Concerns in Vanuatu Remain Unaddressed

The Asia/Pacific Group on Money Laundering (APG) has expressed deep concerns over the ongoing failure of Vanuatu to effectively combat money laundering and terrorist financing.

Serious Deficiencies Remain

Despite previous efforts, the country’s anti-money laundering system remains riddled with serious deficiencies. The APG statement highlights several key areas where Vanuatu falls short:

• Inadequate criminalization of money laundering and terrorist financing
• Insufficient measures to implement UN sanctions against terrorists
• Poor customer due diligence practices
• Lacking supervisory frameworks for financial institutions and non-financial businesses

A Long-Standing Issue

These deficiencies were first identified in 2006 by the APG, but have yet to be adequately addressed. Vanuatu’s latest mutual evaluation report, published in July 2015, reveals that the country’s system demonstrates low levels of effectiveness in implementing global anti-money laundering and combating the financing of terrorism (AML/CFT) standards.

Urgent Action Required

The APG is urging Vanuatu to take swift action to rectify these shortcomings and enhance the effectiveness of its AML/CFT system. The statement will remain in place until the most critical deficiencies are addressed, as determined by the APG membership through its peer monitoring and follow-up process.

Previous Efforts Have Fallen Short

Vanuatu had previously enacted anti-money laundering legislation in 2014, but the laws did not fully address all deficiencies. Amendments to the Proceeds of Crime Act and Counter Terrorism and Transnational and Organized Crime Act were brought into force in January 2015, but these too failed to adequately address the criminalization of money laundering and terrorist financing.

International Scrutiny

In light of these ongoing concerns, the APG has referred Vanuatu to the Financial Action Task Force’s International Cooperation Review Group for further scrutiny.