Cambodia joins Syria, Yemen on finance watchdog AML alert

Cambodia has been identified as one of 12 jurisdictions with “strategic anti money laundering [AML] and combatting the financing of terrorism [CFT] deficiencies”.

It joins countries that are wracked by civil war, namely Syria and Yemen; as well as an established offshore investment destination, the Bahamas, on the list of the Financial Action Task Force (FATF), a global financial watchdog based in Paris, France.

According to a statement by a Cambodian Ministry of Economy and Finance spokesman in May last year, Cambodia had at that time more than 100 casinos that had been granted ministry licences to operate in that country.

The FATF said in a Friday announcement that Cambodia had this month made a “high-level political commitment to work with the FATF” and another body – the Asia/Pacific Group on Money Laundering (APG) – to “strengthen the effectiveness of its anti-money laundering and combatting the financing of terrorism regime and address any related technical deficiencies”.

A 10-point plan drawn up with the country’s authorities included “implementing risk-based supervision for real estate and casinos”.

The latest document indicated that there had not been significant progress in Cambodia’s approach to some important anti-money laundering procedures since a mutual evaluation report between the FATF and that nation had been adopted in July 2017.

In September last year, a first follow-up report by the FATF on that evaluation mentioned that “the main deficiencies were that the outcomes of Cambodia’s 2016 national risk assessment had not been provided to reporting entities”.

The FATF stated in its September 2018 report that the “main technical deficiencies” included: no domestic legal instruments that dealt with money laundering outside the ASEAN [Association of Southeast Asian Nations] Money Laundering framework, other than in relation to drug, corruption and terrorism-related offences; no clear process for the timely prioritisation and execution of money laundering requests; no case management system to monitor requests; and no provisions to maintain the confidentiality of requests”.