12° Nicosia,
21 May, 2024

MONEYVAL: Cyprus makes some progress in the fight against money laundering

But a number of other shortcomings remain

Source: CNA

Cyprus has made some progress in the fight against money laundering and terrorist financing by partially complying with recommendations set out by the Financial Action Task Force (FATF), according to a report by the Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism - MONEYVAL.

According to MONEYVAL's progress report, published on Thursday, Cypriot authorities did implement several compliance improvement measures but did not do so in time for them to be assessed at this stage. Moreover, a number of other shortcomings still need to be addressed.

In its initial report in 2019, MONEYVAL considered Cyprus to have fully, or to a large extent, complied with 37 of the 40 FATF recommendations.  It also noted that MONEYVAL asked Cypriot authorities to report on their progress on implementing the remaining recommendations wherein Cyprus was judged to be only 'partially compliant'.

The progress report, according to the press release, examines a series of legislative, regulatory and institutional measures implemented by the Cypriot authorities in relation to risk assessment and monitoring in the non-profit sector, as well as the evaluation of customer relations by correspondents banks. It also assesses the ability of authorities to monitor communications and apply cash delivery and negotiable delivery techniques within the bearer.

The progress report also assesses the implementation of new international requirements for fictitious asset service providers as set out in a revised FATF Recommendation. The assessment of the implementation of this revised Recommendation by Cyprus has been downgraded from "compliant to a large extent" to "partially compliant".

The Cypriot authorities, the report added, have taken a number of steps to implement these new FATF requirements, including the December 2021 version of the Risk Assessment of Money Laundering and Terrorist Financing of Fictitious Assets and the relevant service providers. However, these measures were not taken in time to be evaluated in the progress report.

Consequently, Cyprus is deemed to be "fully compliant" with 16 of the 40 FATF recommendations, "largely compliant" with 20 recommendations and "partially compliant" with four recommendations (non-profit organizations, banking response, new technologies and powers of police and investigative authorities).

Cyprus has no “non-compliant” ratings at this moment, the press release notes.

The progress report examines formal changes to the legislative, regulatory and institutional framework in Cyprus, but does not assess the extent to which these reforms have been effectively implemented, based on MONEYVAL's practices.

MONEYVAL, it is added, expects that each country will have faced most, if not all, of its shortcomings by the end of the third year since the adoption of the peer review report. Cyprus is therefore expected to inform MONEYVAL of further progress in implementing the pending recommendations in one year.

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