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 FIU releases second national risk assessment report on ML/TF

FIU releases second national risk assessment report on ML/TF

15 Sep 2023

The Financial Intelligence Unit of Sri Lanka (FIU) of the Central Bank of Sri Lanka (CBSL) recently published the sanitised report of the  2021/22 National Risk Assessment (NRA) on Money Laundering and Terrorist  Financing (ML/TF).  The report was developed based on an assessment conducted by the FIU, together with public and private sector  stakeholders. This assessment highlights the most significant ML/TF threats,  vulnerabilities, and risks faced by Sri Lanka.  

The NRA identified drug trafficking, bribery and corruption, and customs-related  offences including laundering of trade-based proceeds as the most prevalent  predicate offences where ML threat was rated as medium high. Fraud, robbery,  and environmental and natural resource crimes were recorded as having a medium level of  ML threat. Human smuggling/trafficking; tax offences; and illegal, unreported, and unregulated fishing-related unlawful activities were assessed as having a medium  low ML threat. Lower ML threat was observed for counterfeiting of currency.  

Further, the NRA identified the ML risk of financial and designated non-financial  businesses and professions sectors as follows:

The overall ML/TF risk for the country was assessed as “Medium”. 

Based on the NRA, the national policy on anti-money laundering and countering  the financing of terrorism (AML/CFT) of Sri Lanka, and comprehensive action plans for each stakeholder, were prepared to address the gaps identified in order to effectively  combat ML/TF in the country. The AML/CFT national policy and the stakeholder-

wise action plans were approved by the Cabinet of Ministers on 7 August 2023.

Some of  the recommendations made in the NRA include bringing necessary amendments to  relevant laws; introduction of new laws; strengthening institutional framework; capacity-building for investigators, prosecutors, judiciary, and supervisors; and increasing  supervision of designated non-finance businesses and professions, such as real  estate agents, dealers in precious metals and stones, casinos, accountants, lawyers etc. Further, the need for the development of comprehensive databases and  taking actions to expedite the prosecutions and convictions on ML/TF were also identified, while improving interagency co-operation in the fight against ML/TF was also recommended.  

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