The Middle East and North Africa Financial Action Task Force (MENAFATF) released on Friday, December 22, the mutual evaluation report of the Lebanese Republic on anti-money laundering and combating the financing of terrorism (AML/CFT) measures.
The Lebanese Republic’s report stated that Lebanon achieved acceptable outcomes in terms of technical compliance in 34 out of the 40 Financial Action Task Force (FATF) recommendations, receiving ratings ranging from “compliant” to “largely compliant.” For the remaining six recommendations requiring improvements, Lebanon was assessed as “partially compliant,” signifying the need for specific legislative modifications.
Regarding the eleven immediate outcomes measuring effectiveness, MENAFATF indicated that in nine immediate outcomes where Lebanon received a level of “moderate” effectiveness, the country's AML/CFT regime yielded positive results that require further strengthening in some areas. These include risk identification, international cooperation, supervision, and other measures mainly for the non-financial sector, legal persons, arrangements, effective ownership, parallel financial investigations, and targeted financial sanctions regarding United Nations Security Council resolutions.
The other two immediate outcomes where Lebanon was rated as having “low” effectiveness are mainly associated with insufficient confiscation of crime proceeds and assets, and deficiencies related to prosecutions and convictions for money laundering. As such, these outcomes need to be more proportionate to the country's risks and require proportional and deterrent sanctions.
Lebanon underwent assessment based on FATF's evaluation methodology applied in all jurisdictions, with the evaluation process conducted under prevailing exceptional circumstances. However, similar to all jurisdictions, necessary corrective actions require a cross-governmental approach implemented by the relevant national authorities.
As the national coordinator of the evaluation process, the Special Investigation Commission (in the original) will inform the Speaker of Parliament, Nabih Berri, and the Caretaker Prime Minister, Najib Mikati, of the REM results. In turn, these should be communicated to each relevant national authority and the necessary corrective actions should be taken to enhance the effectiveness of AML/CFT. Lebanon will now be required to submit progress reports to MENAFATF in 2024, which will be discussed and decided upon in its plenary meetings.
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