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MONEYVAL - Are You Prepared?

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In the past 12 months we have heard lots about Brexit and COVID-19, both really important issues that affect Gibraltar and its people. However, this has meant that other issues that we have been aware of, such as the MONEYVAL assessment, may have been put on a “back burner”. It is really important at these times to remember that we all have a responsibility to support Gibraltar in being compliant in protecting its reputation as a safe place to do business; particularly regarding Anti-Money Laundering & Countering the Financing of Terrorism.

In a report published by the Council of Europe’s anti-money laundering body MONEYVAL assessed Gibraltar on the tools and mechanisms they have in place to combat money laundering and financing of terrorism. The previous assessment was published by the International Monetary Fund (IMF) in May 2007. It can be seen from the 2019 assessment that Gibraltar has undertaken a lot of remedial action in the last 12 years however, as MONEYVAL notes there is further work to do that will affect all business sectors. https://rm.coe.int/anti-money-laundering-and-counter-terrorist-financing-measures-british/16809c3c45

The MONEYVAL report made a comprehensive assessment of the effectiveness of Gibraltar's current anti money laundering and countering the financing of terrorism system and its level of compliance with the Recommendations of the Financial Action Task Force (FATF).

MONEYVAL Assessment 2019 (FATF Effectiveness)

High                             0 

Substantial                   1

Moderate                     7

Low                              3


MONEYVAL Assessment 2019 (FATF Technical)

Compliant                   15

Largely Compliant      15

Partially Compliant     10

Non-Compliant            0


From previous analysis, the Gibraltar assessment is in line with the Crown Dependencies where the following key failings are consistent. 

Key Points Raise

  • The Gibraltar Financial Intelligence Unit (GFIU) has increased its capacity in recent years and has extended cooperation with the law enforcement and supervisory authorities. However, the GFIU’s Analytical Products did not have a significant impact upon developing investigations into money laundering and predicate offences.
  • The report did recognise improvements in the legal framework which now provides a solid basis for the authorities to detect, investigate and prosecute money laundering and financing of terrorism. However, Gibraltar was unable to demonstrate effective Investigation and Prosecution of money laundering offences. Fundamental improvements are also needed with regard to the Confiscation of proceeds of crime from money laundering and associated predicate offences.
  • Law enforcement authorities demonstrated a good understanding of potential financing of terrorism that may occur in an international financial centre such as Gibraltar. However, the relative Lack of Suspicious Transactions Reports related to the financing of terrorism, considered against transactions that financial institutions carried out with conflict zones and high-risk jurisdictions raised concerns.This as to whether the absence of any prosecutions for terrorist financing is in line with the jurisdiction’s risk profile.
  • The report also reflects that obligations are being implemented to some extent by reporting entities such as financial institutions and designated non-financial businesses and professions (DNFBPs). Their understanding of the money laundering risk is overall satisfactory but differs across and within the sectors. Unlike the money laundering risk, the Financing of Terrorism Risk is Not Properly Understood. The quality of reporting of suspicious transactions remains a concern.
  • Sanctions for non-compliance with anti-money laundering and counter-terrorist financing requirements are Not Considered Proportionate and Dissuasive.

Based on the results of its evaluation, MONEYVAL decided to apply its enhanced follow-up procedure and invited Gibraltar to report back at its first plenary in 2021.

The comments above are high level however, does show there are enhancements that require support in all sectors. 

If you are interested in working with a trusted, experienced and practical professional services provider for AML and compliance training, audit, support or outsourced compliance services please contact Lawrence Hanlin.

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