Action Plan for the Implementation of Recommendations from Money Laundering Risk Assessment and Terrorism Financing Risk Assessment
WORLD BANK & THE FIGHT AGAINST MONEY LAUNDERING
AND TERRORISM FINANCING
The World Bank is not a standard setter in the area of AML/CFT; rather, its main role is to assist countries in meeting global standards of FATF 40+9 Recommendations. Specifically, the World Bank contributes to the prevention and suppression of ML/TF by providing technical assistance on risk management; on building stronger legal and institutional frameworks and on building strong governance frameworks. Since 2001 the World Bank has strengthened partnership with other institutions in global AML/CFT efforts – IMF, UNODC, GOPAC, FATF, etc.
In its efforts to combat ML/TF the World Bank is country/region oriented and does not segregate between the two phenomena. It encourages countries to undertake legislative and institutional reforms, change in mindset and culture, and to strive for better governance.
There are five key principles in the World Bank Country Assistance Programs:
1. AML/CFT measures of importance for financial system soundness. This entails making balance between compliance needs and acess to financial services. Therefore countries should have in place oversight commensurate with risks and abuse.
2. Creating awareness and commitment that sound AML/CFT system is part of financial regulatory framework – promotion of risk-based approach.
3. Taking into account level of development of financial sector and specific features of domestic systems.
4. Ensuring reform measures are appropriate to meet international standards but designed to suit local conditions. In othet words, CDD &KYC rules should be tailored to fit the domestic system, and should not preclude liberalization of financial services.
5. Working towards effectiveness of system and measures. This requires close cooperation and joint responsibility of governemnet authorities, but also networking of foreign law enforcement authorities, FIUs and financial supervisors.