The Financial Action Task Force (FATF), a group that monitors money laundering and terrorism financing, has placed Myanmar on its “black list” and urged its members to exercise more due diligence when dealing with and to do business in Myanmar.
The “black list” of high-risk nations maintained by the FATF now includes Myanmar. The FATF blacklist, formally known as High-Risk Jurisdictions subject to a Call for Action, lists countries with weak regulatory frameworks for countering money laundering and terrorism financing.
Myanmar pledged to resolve its strategic shortcomings in February 2020. However, the action plan for Myanmar ran out in September 2021.
In June 2022, the FATF sternly warned Myanmar that if it didn’t finish its action plan by October 2022, it would be forced to call on its members and encourage all governments to do more due diligence when dealing with the country.
The FATF said that it considered that more action was required following its processes given the ongoing lack of progress and the fact that the bulk of its action items remained unaddressed after a year had passed the action plan deadline.
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FATF urged its members and other governments to take increased due diligence precautions appropriate to the risk associated with Myanmar.
Countries should ensure that transfers of money for legal NPO activity, remittances, and humanitarian aid are not impeded while implementing additional due diligence requirements, the FATF stated.
To address these shortcomings, it was further stated that Myanmar should keep working to implement its action plan.
Which includes showing an improved understanding of money laundering (ML) risks in crucial areas, proving that on-site and offsite inspections are risk-based, and demonstrating that hundi operators are registered and supervised.
In addition, it called for Myanmar to show improved financial intelligence utilization in law enforcement agency (LEA) investigations and to expand operational analysis and dissemination by the Financial Intelligence Units (FIU).
FATF urged Myanmar to increase the freezing, seizure, and confiscation of criminal proceeds, instruments of crime, and property of equivalent value; to manage seized assets to maintain the value of confiscated goods until takeover.
And to demonstrate the implementation of targeted financial sanctions. In addition, FATF urged Myanmar to investigate and prosecute ML following risks (PF).
The FATF encouraged Myanmar to strive to resolve its shortcomings completely. However, until its comprehensive action plan is finished, Myanmar will continue to be on the list of nations under a call for action.
