Financial Crime World

Yemen’s Anti-Money Laundering Efforts Under Scrutiny

Assessment Reveals Significant Deficiencies

A recent assessment of Yemen’s anti-money laundering (AML) efforts has revealed significant deficiencies in the country’s legal framework and enforcement mechanisms. The assessment, conducted by an international organization, highlights the need for Yemen to strengthen its laws and regulations to prevent money laundering and terrorist financing.

  • Yemen’s Commercial Companies Law lacks a clear definition of “funds” or covers only certain designated categories of predicate offenses.
  • The law fails to provide provisions on the criminal liability of legal persons and does not criminalize terrorism financing (TF).

Enforcement Mechanisms Issues

  • The AML Committee is composed of members from various authorities, but there is no sufficient coordination between them.
  • Yemen has not received any mutual legal assistance (MLA) requests, making it difficult to determine the availability of such assistance on a timely basis.

Preventive Measures Limitations

  • Customer due diligence (CDD) processes are limited in many financial institutions, particularly non-banking ones.
  • These institutions often do not verify the identity of beneficial owners or economic right holders and fail to obtain information about the purpose and nature of business relationships.

Need for Strengthening Laws and Regulations

  • Yemen has ratified several international conventions, including the 1998 Vienna Convention and the 2000 Palermo Convention, but lacks a comprehensive legal framework to combat TF.
  • The country is urged to take immediate action to address these deficiencies and strengthen its AML/CFT regime.

FATF Recommendation Rating

Yemen received a rating of “Non-Compliant” with the Financial Action Task Force (FATF) Recommendations, highlighting the need for urgent action to address these deficiencies.

Prohibition of Casinos

In related news, Yemen’s government has announced that it will prohibit casinos in the country, effective immediately. The decision comes after a recent increase in illegal gambling activities and concerns over money laundering and terrorist financing.

  • The government believes that prohibiting casinos will help prevent financial crimes and create a safer environment for citizens.
  • However, the decision is expected to have significant economic implications for the country, particularly in the tourism and hospitality sectors.

Conclusion

Yemen’s AML/CFT regime has been under scrutiny by international organizations in recent years. The prohibition of casinos is seen as a step in the right direction towards addressing these concerns. The country must take immediate action to strengthen its laws and regulations to prevent money laundering and terrorist financing.