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FATF Statement re AML Strategic Deficiencies:
Date: 16 February 2012
Despite Yemen’s high-level political commitment to work with the
FATF and MENAFATF to address its strategic AML/CFT
deficiencies, the FATF is not yet satisfied that Yemen has made
sufficient progress in implementing its action plan and certain
strategic AML/CFT deficiencies remain. Yemen should work on
implementing its action plan to address these deficiencies,
including by: (1) adequately criminalizing money laundering and
terrorist financing (Recommendation 1 and Special
Recommendation II); (2) establishing and implementing adequate
procedures to identify and freeze terrorist assets (Special
Recommendation III); (3) developing the monitoring and
supervisory capacity of the financial sector supervisory authorities
and the Financial Intelligence Unit (FIU), to ensure compliance by
financial institutions with their suspicious transaction reporting
(STR) obligations, especially in relation to the financing of
terrorism (Recommendation 23); and (4) ensuring a fully
operational and effectively functioning FIU (Recommendation 26).
The FATF encourages Yemen to address its remaining
deficiencies and continue the process of implementing its action
plan.
____________________________________________________
Sanctions:
May 16, 2012 - US President signs an Executive Order (E.O.),
“Blocking Property of Persons Threatening the Peace, Security,
or Stability of Yemen.”
Read Executive Order
November 28, 2011 - The Arab League (comprising 22 Arab
member states), of which this country is a member, has approved
imposing sanctions on Syria. These include: -
* Cutting off transactions with the Syrian central bank
* Halting funding by Arab governments for projects in Syria
* A ban on senior Syrian officials travelling to other Arab countries
* A freeze on assets related to President Bashar al-Assad's
government
The declaration also calls on Arab central banks to monitor
transfers to Syria, with the exception of remittances from Syrians
abroad.
For further information, click here
The Arab League (comprising 22 Arab member states), of which
this country is a member, has boycotted Israel in a systematic
effort to isolate Israel economically in support of the Palestinians,
however, the implementation of the boycott has varied over time
among member states..
There are three tiers to the boycott. The primary boycott prohibits
the importation of Israeli-origin goods and services into boycotting
countries. The secondary boycott prohibits individuals, as well as
private and public sector firms and organizations, in member
countries from engaging in business with any entity that does
business in Israel. The Arab League maintains a blacklist of such
firms. The tertiary boycott prohibits any
entity in a member country from doing business with a company or
individual that has business dealings with U.S. or other firms on
the Arab League blacklist.
____________________________________________________
Offshore Jurisdiction Blacklists – Further Information:
Information unavailable.
____________________________________________________
US State Department Money Laundering Report - 2011:
The financial system in Yemen is not well developed, and Yemen
remains relatively isolated from the global financial community.
Alternative remittance systems, such as hawala, are not subject to
scrutiny and are vulnerable to money laundering and other
financial abuses—including possible terrorist financing. Yemen has
a large underground economy due, in part, to the profitability of
the smuggling of trade goods and contraband. The use of khat, a
recreational drug produced from a bush grown in parts of East
Africa and Arabia, is common in Yemen, and there have been a
number of investigations of khat being smuggled from Yemen and
East Africa into the United States with profits laundered and
repatriated via hawala networks. Money laundering within Yemen,
however, is not primarily related to proceeds from illegal narcotics.
Instead, criminal proceeds in Yemen tend to emanate from foreign
criminal activity, including smuggling by criminal networks, and,
possibly, terrorist groups operating locally, although the extent is
unknown. Smuggling and piracy are common along Yemen’s sea
border with Oman, across the Red Sea from the Horn of Africa,
and along the land border with Saudi Arabia.
Yemen does not have an offshore financial center, but does have
one free trade zone (FTZ) in the port city of Aden. Identification
requirements within the FTZ are enforced. Truckers must file the
necessary paperwork in relevant trucking company offices and
must wear ID badges. FTZ employees must undergo background
checks by police, the Customs Authority and employers. There is
no evidence that the FTZ is being used for trade-based money
laundering or terrorist financing schemes.
DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY
TRANSACTIONS RELATED TO INTERNATIONAL NARCOTICS
TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS OF US
CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN
THE U.S.; OR THAT OTHERWISE SIGNIFICANTLY AFFECT THE
U.S.: NO
CRIMINALIZATION OF MONEY LAUNDERING:
“All serious crimes” approach or “list” approach to predicate
crimes: List approach
Legal persons covered: criminally: YES civilly: YES
CRIMINALIZATION OF TERRORIST FINANCING: YES
Ability to freeze terrorist assets without delay: YES
UN lists of designated terrorists or terrorist entities distributed to
financial institutions: YES
(Please refer to the Department of State’s Country Reports on
Terrorism, which can be found at: http://www.state.gov/s/ct/rls/crt/)
KNOW-YOUR-CUSTOMER RULES:
Covered entities: Financial institutions that accept deposits,
provide credit, engage in financial leasing, provide money
transfers, exchange and convert currency, issue payment, finance
mortgages, sell and purchase foreign currency, deal in securities,
invest, manage securities, provide life insurance, and engage in
other financial activities as decided by the Prime Minister
Enhanced due diligence procedures for PEPs: Foreign: YES
Domestic: YES
SUSPICIOUS TRANSACTION REPORTING REQUIREMENTS:
Covered entities: Financial institutions that accept deposits,
provide credit, engage in financial leasing, provide money
transfers, exchange and convert currency, issue payment, finance
mortgages, sell and purchase foreign currency, deal in securities,
invest, manage securities, provide life insurance, and engage in
other financial activities as decided by the Prime Minister
Number of STRs received and time frame: 35 in 2010
Number of CTRs received and time frame: None
MONEY LAUNDERING CRIMINAL
PROSECUTIONS/CONVICTIONS:
Prosecutions: Two
Convictions: None
Assets forfeited: criminally: $5000 civilly: none
RECORDS EXCHANGE MECHANISM:
With U.S.: NO
With other governments/jurisdictions: YES
Yemen is a member of the Middle East and North Africa Financial
Action Task Force (MENAFATF), a Financial Action Task Force-
style regional body. Its most recent evaluation can be found here:
http://www.menafatf.org/images/UploadFiles/YEMEN_EN.pdf
ENFORCEMENT AND IMPLEMENTATION ISSUES AND
COMMENTS:
There are approximately 448 registered money exchange
businesses in Yemen, which serve primarily as currency
exchangers in addition to performing funds transfer services.
Money transfer businesses are required to register with the
Central Bank of Yemen (CBY) and can open offices at multiple
locations. The CBY has not performed examinations of the money
exchange businesses for anti-money laundering/counter-terrorist
financing (AML/CFT) compliance.
Yemen’s financial intelligence unit (AMLIU) has only a few
employees and uses the services of field inspectors from the CBY’
s Banking Supervision Department for some of the FIU duties.
The AMLIU has no database and is not networked to other
government data systems. Only a few STRs have been forwarded
from the AMLIU to judicial authorities for investigation and
possible prosecution. The U.S. Embassy in Sanaa routinely
passes requests for information and assistance to the
Government of Yemen concerning terrorist financing and other
issues, but seldom receives responses.
On December 29, 2009, Yemen’s Parliament passed an AML/CFT
law. On January 17, 2010, the law acquired presidential approval,
becoming Law No. 1 of 2010 (Law 1). Pending in parliamentary
committee since November 2007, the law represents a major step
forward in criminalizing money laundering and terrorist financing,
and institutionalizing the ability of the Yemeni government to
combat these crimes. Law 1 represents more comprehensive
AML/CFT legislation to accommodate international standards. Law
1 expands the types of financial institutions the Yemeni
government will monitor, to include hawaladars, jewelry shops,
lawyers’ associations, and real estate firms.
While Law 1 is a necessary first step in criminalizing money
laundering and terrorist financing, the Yemeni government is now
challenged with the implementation and enforcement of the law.
The government needs to continue to develop an anti-money
laundering regime that adheres to international standards. Banks
and non-bank financial institutions should enhance their capacity
to detect and report suspicious financial transactions to the FIU,
including those related to terrorist financing.
Even with the new law, the AMLIU needs substantial improvement
of its operational capacity to effectively fulfill its responsibilities.
Among other measures: The Republic of Yemen Government
(ROYG) needs to investigate the abuse of alternative remittance
systems such as hawala networks with regard to money
laundering and terrorist financing. Law enforcement and customs
authorities also need to examine trade-based money laundering
and customs fraud.
The ROYG has no institutionalized coordination for terrorism
matters among the different ministries and has yet to implement
steps listed under the UN international terrorism protocols, to
which Yemen is a party. The ROYG lacks specific legislation with
respect to forfeiture of the assets of those suspected of terrorism.
Yemen has not applied UN mandated sanctions or frozen the
assets of Sheikh Abdul Majid Zindani, who was added to the UN
1267 Sanctions Committee’s consolidated list in February 2004.
There is no information on whether Yemeni authorities have
frozen, seized, or demanded forfeiture of other assets related to
terrorist financing.
The ROYG should ratify the UN Convention against Transnational
Organized Crime.
Yemen is ranked 146 out of 178 countries surveyed in
Transparency International’s 2010 Corruption Perception Index.
____________________________________________________
US State Dept Narcotics Report 2011 (introduction):
No report available
____________________________________________________
US State Dept Trafficking in Persons Report 2011
(introduction):
(Tier 3)
Yemen is a country of origin and, to a much lesser extent, a
transit and destination country for men, women and children
subjected to forced labor and sex trafficking. Yemeni children,
mostly boys, migrate to the Yemeni cities of Aden and Sana’a or
travel across the northern border with Saudi Arabia or, to a lesser
extent, to Oman and are forced to work in domestic service, small
shops, or as beggars. Some of these children are subjected to
prostitution by traffickers, border patrols, other security officials,
and their employers in transit or once they arrive in Saudi Arabia.
The government and local NGOs estimate there are hundreds of
thousands of children in forced labor in Yemen. An unconfirmed
government report indicates that fewer Yemeni children may have
been forced to work in Saudi Arabia in the reporting period due to
a combination of awareness campaigns, collaboration between
Yemeni and Saudi authorities, and the outbreak of civil war in
northern Yemen. Some parents may have refrained from sending
their children to Saudi Arabia for fear of them encountering
violence in northern Yemen, while other Yemeni children
attempting to reach Saudi Arabia were abducted by rebel groups
to serve as combatants. In addition, some sources report that the
practice of chattel slavery still exists in Yemen; although no official
statistics exist detailing this practice, sources report that there
could be 300 to 500 men, women, and children sold or inherited
as slaves in Yemen, including in the Al-Zohrah district of Al-
Hudaydah Governorate, west of Sana’a, and the Kuaidinah and
Khairan Al-Muharraq districts of the Hajjah Governorate, north of
the capital.
To a lesser extent, Yemen is also a source country for girls
subjected to sex trafficking within the country and in Saudi Arabia.
Girls as young as 15 are exploited for commercial sex in hotels
and clubs in the governorates of Sana’a, Aden, and Taiz. The
majority of child sex tourists in Yemen originate from Saudi Arabia,
with a smaller number possibly coming from other Gulf nations.
Yemeni girls who marry Saudi tourists often do not realize the
temporary and exploitative nature of these agreements and some
are subjected to sex trafficking or abandoned on the streets after
reaching Saudi Arabia. Yemen is a transit and destination country
for women and children from the Horn of Africa; Ethiopian and
Somali women and children travel voluntarily to Yemen with the
hope of working in other Gulf countries, but once they reach
Yemen, they are subject to sex trafficking or domestic servitude.
Others migrate voluntarily based on false promises of comfortable
employment as domestic servants in Yemen, but upon arrival are
subject to sex trafficking or domestic servitude. Female Somali
refugees are forced into prostitution in Aden and Lahj
governorates and Yemeni and Saudi gangs traffic African children
to Saudi Arabia. Somali pirates capitalize on the instability in the
Horn of Africa to subject Africans to forced labor and prostitution
in Yemen, in addition to their piracy and human smuggling crimes.
Despite a 1991 law that stipulates that recruits to the armed
forces must be at least 18 years of age, and assertions by the
government that the military is in compliance with these laws,
credible reports exist that children have been conscripted into
official government armed forces – as well as into government-
allied tribal militias and militias of the Houthi rebels – since the
sixth round of the intermittent war in Sa’ada began in August
2009. A local NGO estimated that children under the age of 18
may make up more than half of some tribes’ armed forces, both
those fighting with the government and those allied with the
Houthi rebels.
The Government of Yemen does not fully comply with the
minimum standards for the elimination of trafficking, and has been
placed on Tier 2 Watch List for a third consecutive year. Pursuant
to Section 107 of the 2008 Trafficking Victims Protection
Reauthorization Act, therefore, Yemen is deemed not to be
making significant efforts to comply with the minimum standards
and is placed on Tier 3. Due to political unrest, the Government of
Yemen was unable to provide data to contribute to this report. In
November 2010, the Yemeni cabinet approved the country’s
accession to the 2000 UN TIP Protocol. In addition, the
government reportedly prosecuted and convicted traffickers
during the reporting period. Despite these efforts, the Yemeni
government did not take steps to address trafficking for
commercial sexual exploitation or to institute formal procedures to
identify and protect victims of trafficking.
For full report click here
____________________________________________________
US State Dept Terrorism Report 2010
Overview: In 2010, resource limitations and unstable security
conditions in several parts of the country impeded the Yemeni
government's ability to eliminate potential safe havens in Yemen.
In addition, counterterrorism efforts were impeded by a lack of
legislation. Yemen’s vulnerability along it long and weakly
protected borders has allowed al-Qa’ida associates to find safe
haven in Yemen. Nonetheless, the Government of Yemen
continued to build its counterterrorism capacity and deployed its
security forces against terrorist threats. The Yemeni government
security forces killed or captured numerous suspected al-Qa`ida
in the Arabian Peninsula (AQAP) militants, and received
assistance in the form of equipment and training from the United
States. The Yemeni government's response to the terrorist threat
included large-scale kinetic operations against suspected AQAP
members in the south. In turn, AQAP attacks against foreign
interests, Yemeni government targets, and the Shia Houthi
movement in the north increased dramatically in 2010.
2010 Terrorist Incidents: AQAP carried out attacks throughout
Yemen, using improvised explosive devices (IEDs), ambushes,
and car bombs against government, civilian, and foreign targets,
particularly in the South but also within the capital city of Sana'a.
Attacks included:
* On April 26, the British Ambassador's vehicle was attacked by a
suicide bomber as it approached the British Embassy in Sana'a.
The Ambassador escaped unharmed; however, three bystanders
were wounded and the bomber died in the attack.
* On June 19, six to eight suspected AQAP gunmen disguised as
women staged a daylight attack on a security service
headquarters in Aden, killed 12 civilians.
* On July 14, 20 suspected AQAP gunmen staged a coordinated
attack on the intelligence and police headquarters in Zinjibar,
killing three people.
* On October 6, a vehicle carrying the British Deputy Chief of
Mission was attacked with an anti-tank rocket as it was
approaching the British Embassy in Sana'a. One Embassy
employee and two bystanders were injured.
* On October 29, a plot to send two parcels containing IEDs on
two separate flights bound for the United States was discovered.
AQAP claimed responsibility.
* On December 15, a man of unknown affiliation detonated a
grenade in the bed of an armored pickup truck with four U.S.
Embassy personnel aboard outside of a popular restaurant in the
Hadda neighborhood of Sana'a. No one was injured. A crowd of
Yemenis attacked the man and held him until Yemeni government
authorities arrived.
* AQAP also claimed two suicide attacks against Shia Houthis in
the north on November 24 and 26 that resulted in 28 dead and
many more wounded. Following these attacks, AQAP reportedly
ordered the establishment of Salafi brigades to halt the spread of
Shiism in Sa'ada governorate.
Legislation and Law Enforcement: Counterterrorism legislation
sent to a Parliamentary committee for review in 2008 was not
enacted by the end of 2010. For this reason, the Yemeni
government must apply other means, including fraudulent
document or "membership in an armed gang" laws against foreign
fighters intending to go to Afghanistan or elsewhere. Those
involved in acts resulting in injury, death, or property destruction
may be prosecuted under existing laws. However, terrorism was
not defined as a crime per se. As of the end of the year, legal,
political, and logistical hurdles hindered an effective detention and
rehabilitation program for Guantanamo returnees. The
government lacked a legal framework to hold Guantanamo
detainees for more than a short period of time. Yemen
participated in the Megaports and Container Security Initiatives.
Countering Terrorism Finance: On December 29, 2009, Yemen's
Parliament passed long-stalled counterterrorist finance and anti-
money laundering legislation, which was signed into law on
January 17, 2010, as Law No. 1 of 2010. It provided the
government with powers to investigate and prosecute terrorist
financial networks operating inside the country. The Financial
Action Task Force’s International Cooperation Review Group,
determined that the law was an improvement but did not yet meet
international standards and was not yet effectively implemented.
Yemen is a member of the Middle East and North Africa Financial
Action Task Force (MENAFATF). There was no information on
whether Yemeni authorities have frozen, seized, or demanded
forfeiture of other assets related to terrorist financing.
Regional and International Cooperation: The Friends of Yemen
process began in 2010 as a forum for two dozen countries,
including Yemen, to coordinate a strategic plan of assistance and
reform for Yemen. Members have used the forum to advance
initiatives such as those related to border security and detainee
rehabilitation. Yemen acceded to the International Convention on
the Suppression of the Financing of Terrorism.
Countering Radicalization and Violent Extremism: Official and
quasi-official media featured messages from President Saleh and
other high-level officials and opinion leaders denigrating violent
extremism and AQAP. However, Yemeni government messaging
did not distinguish between terrorist groups and groups with
political opposition to the Yemeni government, and often identified
the Southern Movement and the Houthi organizations as "violent
extremist" organizations.
____________________________________________________
Links:
Worldwide AML Legislation (International Bar Association)
Date: 16 February 2012
Despite Yemen’s high-level political commitment to work with the
FATF and MENAFATF to address its strategic AML/CFT
deficiencies, the FATF is not yet satisfied that Yemen has made
sufficient progress in implementing its action plan and certain
strategic AML/CFT deficiencies remain. Yemen should work on
implementing its action plan to address these deficiencies,
including by: (1) adequately criminalizing money laundering and
terrorist financing (Recommendation 1 and Special
Recommendation II); (2) establishing and implementing adequate
procedures to identify and freeze terrorist assets (Special
Recommendation III); (3) developing the monitoring and
supervisory capacity of the financial sector supervisory authorities
and the Financial Intelligence Unit (FIU), to ensure compliance by
financial institutions with their suspicious transaction reporting
(STR) obligations, especially in relation to the financing of
terrorism (Recommendation 23); and (4) ensuring a fully
operational and effectively functioning FIU (Recommendation 26).
The FATF encourages Yemen to address its remaining
deficiencies and continue the process of implementing its action
plan.
____________________________________________________
Sanctions:
May 16, 2012 - US President signs an Executive Order (E.O.),
“Blocking Property of Persons Threatening the Peace, Security,
or Stability of Yemen.”
Read Executive Order
November 28, 2011 - The Arab League (comprising 22 Arab
member states), of which this country is a member, has approved
imposing sanctions on Syria. These include: -
* Cutting off transactions with the Syrian central bank
* Halting funding by Arab governments for projects in Syria
* A ban on senior Syrian officials travelling to other Arab countries
* A freeze on assets related to President Bashar al-Assad's
government
The declaration also calls on Arab central banks to monitor
transfers to Syria, with the exception of remittances from Syrians
abroad.
For further information, click here
The Arab League (comprising 22 Arab member states), of which
this country is a member, has boycotted Israel in a systematic
effort to isolate Israel economically in support of the Palestinians,
however, the implementation of the boycott has varied over time
among member states..
There are three tiers to the boycott. The primary boycott prohibits
the importation of Israeli-origin goods and services into boycotting
countries. The secondary boycott prohibits individuals, as well as
private and public sector firms and organizations, in member
countries from engaging in business with any entity that does
business in Israel. The Arab League maintains a blacklist of such
firms. The tertiary boycott prohibits any
entity in a member country from doing business with a company or
individual that has business dealings with U.S. or other firms on
the Arab League blacklist.
____________________________________________________
Offshore Jurisdiction Blacklists – Further Information:
Information unavailable.
____________________________________________________
US State Department Money Laundering Report - 2011:
The financial system in Yemen is not well developed, and Yemen
remains relatively isolated from the global financial community.
Alternative remittance systems, such as hawala, are not subject to
scrutiny and are vulnerable to money laundering and other
financial abuses—including possible terrorist financing. Yemen has
a large underground economy due, in part, to the profitability of
the smuggling of trade goods and contraband. The use of khat, a
recreational drug produced from a bush grown in parts of East
Africa and Arabia, is common in Yemen, and there have been a
number of investigations of khat being smuggled from Yemen and
East Africa into the United States with profits laundered and
repatriated via hawala networks. Money laundering within Yemen,
however, is not primarily related to proceeds from illegal narcotics.
Instead, criminal proceeds in Yemen tend to emanate from foreign
criminal activity, including smuggling by criminal networks, and,
possibly, terrorist groups operating locally, although the extent is
unknown. Smuggling and piracy are common along Yemen’s sea
border with Oman, across the Red Sea from the Horn of Africa,
and along the land border with Saudi Arabia.
Yemen does not have an offshore financial center, but does have
one free trade zone (FTZ) in the port city of Aden. Identification
requirements within the FTZ are enforced. Truckers must file the
necessary paperwork in relevant trucking company offices and
must wear ID badges. FTZ employees must undergo background
checks by police, the Customs Authority and employers. There is
no evidence that the FTZ is being used for trade-based money
laundering or terrorist financing schemes.
DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY
TRANSACTIONS RELATED TO INTERNATIONAL NARCOTICS
TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS OF US
CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN
THE U.S.; OR THAT OTHERWISE SIGNIFICANTLY AFFECT THE
U.S.: NO
CRIMINALIZATION OF MONEY LAUNDERING:
“All serious crimes” approach or “list” approach to predicate
crimes: List approach
Legal persons covered: criminally: YES civilly: YES
CRIMINALIZATION OF TERRORIST FINANCING: YES
Ability to freeze terrorist assets without delay: YES
UN lists of designated terrorists or terrorist entities distributed to
financial institutions: YES
(Please refer to the Department of State’s Country Reports on
Terrorism, which can be found at: http://www.state.gov/s/ct/rls/crt/)
KNOW-YOUR-CUSTOMER RULES:
Covered entities: Financial institutions that accept deposits,
provide credit, engage in financial leasing, provide money
transfers, exchange and convert currency, issue payment, finance
mortgages, sell and purchase foreign currency, deal in securities,
invest, manage securities, provide life insurance, and engage in
other financial activities as decided by the Prime Minister
Enhanced due diligence procedures for PEPs: Foreign: YES
Domestic: YES
SUSPICIOUS TRANSACTION REPORTING REQUIREMENTS:
Covered entities: Financial institutions that accept deposits,
provide credit, engage in financial leasing, provide money
transfers, exchange and convert currency, issue payment, finance
mortgages, sell and purchase foreign currency, deal in securities,
invest, manage securities, provide life insurance, and engage in
other financial activities as decided by the Prime Minister
Number of STRs received and time frame: 35 in 2010
Number of CTRs received and time frame: None
MONEY LAUNDERING CRIMINAL
PROSECUTIONS/CONVICTIONS:
Prosecutions: Two
Convictions: None
Assets forfeited: criminally: $5000 civilly: none
RECORDS EXCHANGE MECHANISM:
With U.S.: NO
With other governments/jurisdictions: YES
Yemen is a member of the Middle East and North Africa Financial
Action Task Force (MENAFATF), a Financial Action Task Force-
style regional body. Its most recent evaluation can be found here:
http://www.menafatf.org/images/UploadFiles/YEMEN_EN.pdf
ENFORCEMENT AND IMPLEMENTATION ISSUES AND
COMMENTS:
There are approximately 448 registered money exchange
businesses in Yemen, which serve primarily as currency
exchangers in addition to performing funds transfer services.
Money transfer businesses are required to register with the
Central Bank of Yemen (CBY) and can open offices at multiple
locations. The CBY has not performed examinations of the money
exchange businesses for anti-money laundering/counter-terrorist
financing (AML/CFT) compliance.
Yemen’s financial intelligence unit (AMLIU) has only a few
employees and uses the services of field inspectors from the CBY’
s Banking Supervision Department for some of the FIU duties.
The AMLIU has no database and is not networked to other
government data systems. Only a few STRs have been forwarded
from the AMLIU to judicial authorities for investigation and
possible prosecution. The U.S. Embassy in Sanaa routinely
passes requests for information and assistance to the
Government of Yemen concerning terrorist financing and other
issues, but seldom receives responses.
On December 29, 2009, Yemen’s Parliament passed an AML/CFT
law. On January 17, 2010, the law acquired presidential approval,
becoming Law No. 1 of 2010 (Law 1). Pending in parliamentary
committee since November 2007, the law represents a major step
forward in criminalizing money laundering and terrorist financing,
and institutionalizing the ability of the Yemeni government to
combat these crimes. Law 1 represents more comprehensive
AML/CFT legislation to accommodate international standards. Law
1 expands the types of financial institutions the Yemeni
government will monitor, to include hawaladars, jewelry shops,
lawyers’ associations, and real estate firms.
While Law 1 is a necessary first step in criminalizing money
laundering and terrorist financing, the Yemeni government is now
challenged with the implementation and enforcement of the law.
The government needs to continue to develop an anti-money
laundering regime that adheres to international standards. Banks
and non-bank financial institutions should enhance their capacity
to detect and report suspicious financial transactions to the FIU,
including those related to terrorist financing.
Even with the new law, the AMLIU needs substantial improvement
of its operational capacity to effectively fulfill its responsibilities.
Among other measures: The Republic of Yemen Government
(ROYG) needs to investigate the abuse of alternative remittance
systems such as hawala networks with regard to money
laundering and terrorist financing. Law enforcement and customs
authorities also need to examine trade-based money laundering
and customs fraud.
The ROYG has no institutionalized coordination for terrorism
matters among the different ministries and has yet to implement
steps listed under the UN international terrorism protocols, to
which Yemen is a party. The ROYG lacks specific legislation with
respect to forfeiture of the assets of those suspected of terrorism.
Yemen has not applied UN mandated sanctions or frozen the
assets of Sheikh Abdul Majid Zindani, who was added to the UN
1267 Sanctions Committee’s consolidated list in February 2004.
There is no information on whether Yemeni authorities have
frozen, seized, or demanded forfeiture of other assets related to
terrorist financing.
The ROYG should ratify the UN Convention against Transnational
Organized Crime.
Yemen is ranked 146 out of 178 countries surveyed in
Transparency International’s 2010 Corruption Perception Index.
____________________________________________________
US State Dept Narcotics Report 2011 (introduction):
No report available
____________________________________________________
US State Dept Trafficking in Persons Report 2011
(introduction):
(Tier 3)
Yemen is a country of origin and, to a much lesser extent, a
transit and destination country for men, women and children
subjected to forced labor and sex trafficking. Yemeni children,
mostly boys, migrate to the Yemeni cities of Aden and Sana’a or
travel across the northern border with Saudi Arabia or, to a lesser
extent, to Oman and are forced to work in domestic service, small
shops, or as beggars. Some of these children are subjected to
prostitution by traffickers, border patrols, other security officials,
and their employers in transit or once they arrive in Saudi Arabia.
The government and local NGOs estimate there are hundreds of
thousands of children in forced labor in Yemen. An unconfirmed
government report indicates that fewer Yemeni children may have
been forced to work in Saudi Arabia in the reporting period due to
a combination of awareness campaigns, collaboration between
Yemeni and Saudi authorities, and the outbreak of civil war in
northern Yemen. Some parents may have refrained from sending
their children to Saudi Arabia for fear of them encountering
violence in northern Yemen, while other Yemeni children
attempting to reach Saudi Arabia were abducted by rebel groups
to serve as combatants. In addition, some sources report that the
practice of chattel slavery still exists in Yemen; although no official
statistics exist detailing this practice, sources report that there
could be 300 to 500 men, women, and children sold or inherited
as slaves in Yemen, including in the Al-Zohrah district of Al-
Hudaydah Governorate, west of Sana’a, and the Kuaidinah and
Khairan Al-Muharraq districts of the Hajjah Governorate, north of
the capital.
To a lesser extent, Yemen is also a source country for girls
subjected to sex trafficking within the country and in Saudi Arabia.
Girls as young as 15 are exploited for commercial sex in hotels
and clubs in the governorates of Sana’a, Aden, and Taiz. The
majority of child sex tourists in Yemen originate from Saudi Arabia,
with a smaller number possibly coming from other Gulf nations.
Yemeni girls who marry Saudi tourists often do not realize the
temporary and exploitative nature of these agreements and some
are subjected to sex trafficking or abandoned on the streets after
reaching Saudi Arabia. Yemen is a transit and destination country
for women and children from the Horn of Africa; Ethiopian and
Somali women and children travel voluntarily to Yemen with the
hope of working in other Gulf countries, but once they reach
Yemen, they are subject to sex trafficking or domestic servitude.
Others migrate voluntarily based on false promises of comfortable
employment as domestic servants in Yemen, but upon arrival are
subject to sex trafficking or domestic servitude. Female Somali
refugees are forced into prostitution in Aden and Lahj
governorates and Yemeni and Saudi gangs traffic African children
to Saudi Arabia. Somali pirates capitalize on the instability in the
Horn of Africa to subject Africans to forced labor and prostitution
in Yemen, in addition to their piracy and human smuggling crimes.
Despite a 1991 law that stipulates that recruits to the armed
forces must be at least 18 years of age, and assertions by the
government that the military is in compliance with these laws,
credible reports exist that children have been conscripted into
official government armed forces – as well as into government-
allied tribal militias and militias of the Houthi rebels – since the
sixth round of the intermittent war in Sa’ada began in August
2009. A local NGO estimated that children under the age of 18
may make up more than half of some tribes’ armed forces, both
those fighting with the government and those allied with the
Houthi rebels.
The Government of Yemen does not fully comply with the
minimum standards for the elimination of trafficking, and has been
placed on Tier 2 Watch List for a third consecutive year. Pursuant
to Section 107 of the 2008 Trafficking Victims Protection
Reauthorization Act, therefore, Yemen is deemed not to be
making significant efforts to comply with the minimum standards
and is placed on Tier 3. Due to political unrest, the Government of
Yemen was unable to provide data to contribute to this report. In
November 2010, the Yemeni cabinet approved the country’s
accession to the 2000 UN TIP Protocol. In addition, the
government reportedly prosecuted and convicted traffickers
during the reporting period. Despite these efforts, the Yemeni
government did not take steps to address trafficking for
commercial sexual exploitation or to institute formal procedures to
identify and protect victims of trafficking.
For full report click here
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US State Dept Terrorism Report 2010
Overview: In 2010, resource limitations and unstable security
conditions in several parts of the country impeded the Yemeni
government's ability to eliminate potential safe havens in Yemen.
In addition, counterterrorism efforts were impeded by a lack of
legislation. Yemen’s vulnerability along it long and weakly
protected borders has allowed al-Qa’ida associates to find safe
haven in Yemen. Nonetheless, the Government of Yemen
continued to build its counterterrorism capacity and deployed its
security forces against terrorist threats. The Yemeni government
security forces killed or captured numerous suspected al-Qa`ida
in the Arabian Peninsula (AQAP) militants, and received
assistance in the form of equipment and training from the United
States. The Yemeni government's response to the terrorist threat
included large-scale kinetic operations against suspected AQAP
members in the south. In turn, AQAP attacks against foreign
interests, Yemeni government targets, and the Shia Houthi
movement in the north increased dramatically in 2010.
2010 Terrorist Incidents: AQAP carried out attacks throughout
Yemen, using improvised explosive devices (IEDs), ambushes,
and car bombs against government, civilian, and foreign targets,
particularly in the South but also within the capital city of Sana'a.
Attacks included:
* On April 26, the British Ambassador's vehicle was attacked by a
suicide bomber as it approached the British Embassy in Sana'a.
The Ambassador escaped unharmed; however, three bystanders
were wounded and the bomber died in the attack.
* On June 19, six to eight suspected AQAP gunmen disguised as
women staged a daylight attack on a security service
headquarters in Aden, killed 12 civilians.
* On July 14, 20 suspected AQAP gunmen staged a coordinated
attack on the intelligence and police headquarters in Zinjibar,
killing three people.
* On October 6, a vehicle carrying the British Deputy Chief of
Mission was attacked with an anti-tank rocket as it was
approaching the British Embassy in Sana'a. One Embassy
employee and two bystanders were injured.
* On October 29, a plot to send two parcels containing IEDs on
two separate flights bound for the United States was discovered.
AQAP claimed responsibility.
* On December 15, a man of unknown affiliation detonated a
grenade in the bed of an armored pickup truck with four U.S.
Embassy personnel aboard outside of a popular restaurant in the
Hadda neighborhood of Sana'a. No one was injured. A crowd of
Yemenis attacked the man and held him until Yemeni government
authorities arrived.
* AQAP also claimed two suicide attacks against Shia Houthis in
the north on November 24 and 26 that resulted in 28 dead and
many more wounded. Following these attacks, AQAP reportedly
ordered the establishment of Salafi brigades to halt the spread of
Shiism in Sa'ada governorate.
Legislation and Law Enforcement: Counterterrorism legislation
sent to a Parliamentary committee for review in 2008 was not
enacted by the end of 2010. For this reason, the Yemeni
government must apply other means, including fraudulent
document or "membership in an armed gang" laws against foreign
fighters intending to go to Afghanistan or elsewhere. Those
involved in acts resulting in injury, death, or property destruction
may be prosecuted under existing laws. However, terrorism was
not defined as a crime per se. As of the end of the year, legal,
political, and logistical hurdles hindered an effective detention and
rehabilitation program for Guantanamo returnees. The
government lacked a legal framework to hold Guantanamo
detainees for more than a short period of time. Yemen
participated in the Megaports and Container Security Initiatives.
Countering Terrorism Finance: On December 29, 2009, Yemen's
Parliament passed long-stalled counterterrorist finance and anti-
money laundering legislation, which was signed into law on
January 17, 2010, as Law No. 1 of 2010. It provided the
government with powers to investigate and prosecute terrorist
financial networks operating inside the country. The Financial
Action Task Force’s International Cooperation Review Group,
determined that the law was an improvement but did not yet meet
international standards and was not yet effectively implemented.
Yemen is a member of the Middle East and North Africa Financial
Action Task Force (MENAFATF). There was no information on
whether Yemeni authorities have frozen, seized, or demanded
forfeiture of other assets related to terrorist financing.
Regional and International Cooperation: The Friends of Yemen
process began in 2010 as a forum for two dozen countries,
including Yemen, to coordinate a strategic plan of assistance and
reform for Yemen. Members have used the forum to advance
initiatives such as those related to border security and detainee
rehabilitation. Yemen acceded to the International Convention on
the Suppression of the Financing of Terrorism.
Countering Radicalization and Violent Extremism: Official and
quasi-official media featured messages from President Saleh and
other high-level officials and opinion leaders denigrating violent
extremism and AQAP. However, Yemeni government messaging
did not distinguish between terrorist groups and groups with
political opposition to the Yemeni government, and often identified
the Southern Movement and the Houthi organizations as "violent
extremist" organizations.
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Links:
Worldwide AML Legislation (International Bar Association)
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*Please note that FATF deems that a country has significant aml deficiencies if
any of the 'Core' Recommendations, R1, R5, R10, R13, SRII, or SRIV are rated
either Partially of Non-Compliant. These are marked in red.
For FATF to remove a country from the regular follow-up process, it has to be rated
Compliant or Largely Compliant in the above mentioned Core Recommendations
and the following Key Recommendations: -
R3, R4, R23, R26, R35, R36, R40, SRI, SRIII, SRV
Please also note that any risk assessment should take into consideration all
follow-up reports.
any of the 'Core' Recommendations, R1, R5, R10, R13, SRII, or SRIV are rated
either Partially of Non-Compliant. These are marked in red.
For FATF to remove a country from the regular follow-up process, it has to be rated
Compliant or Largely Compliant in the above mentioned Core Recommendations
and the following Key Recommendations: -
R3, R4, R23, R26, R35, R36, R40, SRI, SRIII, SRV
Please also note that any risk assessment should take into consideration all
follow-up reports.
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| Further Tables |
| YEMEN |
| KnowYourCountry |
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| Last Updated: 18 May 2012 |