SL lacks proper frameworks in anti-money laundering, counter-terrorist funding: EU

The European Commission on Wednesday listed Sri Lanka among 23 countries with strategic deficiencies in their anti-money laundering and counter-terrorist financing frameworks.

The Commission adopted the new list of third (non-European) countries with weak anti-money laundering and terrorist financing regimes with the aim of protecting the EU financial system by preventing money laundering and terrorist financing risks.

“As a result of the listing, banks and other entities covered by EU anti-money laundering rules will be required to apply increased checks (due diligence) on financial operations involving customers and financial institutions from these high-risk third countries to better identify any suspicious money flows,” a statement by the Commission said.

The 23 countries are Afghanistan, American Samoa, the Bahamas, Botswana, Democratic People's Republic of Korea, Ethiopia, Ghana, Guam, Iran, Iraq, Libya, Nigeria, Pakistan, Panama, Puerto Rico, Samoa, Saudi Arabia, Sri Lanka, Syria, Trinidad and Tobago, Tunisia, US Virgin Islands and Yemen.

Věra Jourová, Commissioner for Justice, Consumers and Gender Equality said they have established the strongest anti-money laundering standards in the world but they have to make sure that dirty money from other countries does not find its way to our financial system.

“Dirty money is the lifeblood of organised crime and terrorism. I invite the countries listed to remedy their deficiencies swiftly. The Commission stands ready to work closely with them to address these issues in our mutual interest,” she said.

The Commission adopted list in the form of a Delegated Regulation would be submitted to the European Parliament and Council for approval within one month with a possible one-month extension.

Once approved, the Delegated Regulation will be published in the Official Journal and will enter into force 20 days after its publication.

The statement said the Commission would continue its engagement with the countries identified as having strategic deficiencies in the present Delegated Regulation and will further engage especially on the delisting criteria.

“This list enables the countries concerned to better identify the areas for improvement in order to pave the way for a possible delisting once strategic deficiencies are addressed,” it said. (Lahiru Pothmulla)