The Southeast Asian nation of Myanmar – renowned as a hub for illicit gambling and other activities in the Golden Triangle region – was last week named as one of three nations still on the Financial Action Task Force’s “black list” following the global AML watchdog’s latest plenary meeting in Paris.
The black list refers to jurisdictions with “significant strategic deficiencies in their regimes to counter money laundering, terrorist financing, and financing of proliferation” and requires all other member nations to “apply enhanced due diligence … in the most serious cases, countries are called upon to apply counter-measures to protect the international financial system from the money laundering, terrorist financing, and proliferation financing (ML/TF/PF) risks emanating from the country.”
North Korea and Iran also remain on the list, although FATF said it has paused its review process for both since February 2020 given they are already subject to its call for countermeasures.
On Myanmar, FATF noted that the country had in February 2020 committed to address its strategic deficiencies, however its action plan expired in September 2021. Given the continued lack of progress and the majority of its action items still not addressed more than a year beyond the action plan deadline, in October 2020 the FATF decided that further action was necessary in line with its procedures and called on its members and other jurisdictions to apply enhanced due diligence measures proportionate to the risk arising from Myanmar.
In October 2023, Myanmar took steps to prioritize inspection of certain DNFBP (designated non-financial businesses and professions) sectors on a risk basis, but according to the FATF, overall progress continues to be slow.
In a statement following conclusion of the plenary meeting on Friday, the FATF said, “Myanmar should continue to work on implementing its action plan to address these deficiencies, including by: demonstrating an improved understanding of money laundering risks in key areas; demonstrating that hundi operators are registered and supervised; demonstrating enhanced use of financial intelligence in law enforcement authorities investigations, and increasing operational analysis and disseminations by the financial intelligence unit; ensuring that money laundering is investigated/prosecuted in line with risks; demonstrating investigation of transnational money laundering cases with international cooperation; demonstrating an increase in the freezing/seizing and confiscation of criminal proceeds, instrumentalities, and/or property of equivalent value; managing seized assets to preserve the value of seized goods until confiscation; and addressing technical compliance deficiencies … to ensure effective implementation of targeted financial sanctions related to proliferation financing.”
The FATF added that it urges Myanmar to “fully address” its AML/CFT deficiencies and demonstrate that its monitoring and supervision of money or value transfer services is based on documented and sound understanding of ML/TF risks to mitigate undue scrutiny of legitimate financial flows.
“Myanmar will remain on the list of countries subject to a call for action until its full action plan is completed,” the FATF said.
