Structural Elements
What structural elements underpin the AML/CFT system including regulation and supervision, enforcement, anti-corruption measures and the integrity of its judicial system?
Political governance
Strength of regulation and supervision
Level of enforcement,
Anti-corruption measures,
Legislation in place
Integrity of the country’s judicial system.
Measures
The effectiveness and commitment to combat money laundering is obviously dependent upon the political will and support within the country, together with sufficient monies made available to pay for it.
In the past FATF Mutual Evaluations have concentrated on the AML systems in place in the country but that focus shifted with the implementation of the 4th round of mutual evaluations, wherein FATF adopted complementary approaches for assessing technical compliance with the FATF Recommendations, and for assessing whether and how the AML/CFT system is effective.
Measures to determine the high-level commitment to address AML/CFT issues of any country would therefore begin by reviewing the last Mutual Evaluation Report published, especially if that report was conducted under the 4th round exercise, but also by looking at other factors such as political governance, the strength of regulation and supervision, the level of enforcement, anti-corruption measures, and the integrity of the country’s judicial system.
Recently, Global Initiative published the Global Organized Crime index, which includes in its rankings all the UN member states, and covers Criminal Markets, Criminal Actors, and Resilience. The Resilience index assesses 12 indicators, or building blocks, of resilience to organized crime on a country-by-country basis.
World Bank’s Governance indicators provide ratings on Voice & Accountability, Political Stability, Rule of Law, Government effectiveness and Regulatory quality
AML & Related Legislation in Force
Each year the US State Department publishes the International Narcotics Control Strategy Report, which identifies the broad range of actions that jurisdictions have, or have not, taken to combat money laundering. It should be noted that elements of that report include legislative activity and other identifying characteristics that can have a relationship to a jurisdiction’s money laundering vulnerability.
Furthermore, countries are expected to have signed up to a number of UN Conventions. These are: -
a) Convention Against Transnational Organized Crime,
b) 1988 UN Drug Convention and
c) Convention Against Corruption
