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One of the primary issues for consideration is problems with conducting a national ML/TF risk assessment. A big challenge is for jurisdictions to adopt similar concepts and approaches to conducting these assessments. Currently, there is often a struggle with the capacity to cooperate among both jurisdictions and relevant authorities.
There are barriers to the exchange of information and mutual investigations. Considering the magnitude of national scale and lack of certainty which commonly leads to focus on indicators of threat, it is vital to remove barriers to cooperation. Using similar definitions will allow for the efficient functioning of relevant structures by ensuring effective communication and comparison of data amongst jurisdictions.
The issue is being able to compile pertinent information into a statement that identifies specific threats. The FATF recommendations which focus on the jurisdictional capacity to conduct risk assessments are collaboration amongst various authorities and branches of law enforcement as well as the availability of appropriate data. Having a structured method to collect and analyze data will help to gather and exchange data, which is inherently valuable to a large-scale ML/TF risk assessment.
It is recommended that the information collected by FIU goes beyond traditional data from the financial resources but considering terrorist finance and money laundering investigated by traditional law enforcement. Although more anecdotal and less comprehensive, it can still guide or bring public attention to a certain case. Competent authorities can agree on a qualitative assessment even if the information is imprecise, which identified potential threats (Financial Action Task Force 27).
Another issue is the availability of resources when conducting national ML/TF risk assessments. The assessment process is extremely complex and time-consuming, requiring increasing coordination of agencies and resources. Various aspects include personnel, time, research, and access to information. Organization and a production plan are vital for a competent approach to investigations and the information collection process. Furthermore, as informational standards and requirements increase, intelligence needs to be prioritized to key areas where vital data can be acquired (Financial Action Task Force 17).
Both law enforcement, task forces as well as banks should have improved mechanisms of anti-money laundering monitoring systems. For example, banks can perform customer screening for any unusual transactions and identifications. The capabilities of the IT systems are present. However, there is an inherent lack of guidelines, knowledge, or resources to address practical concerns that are commonly seen in money laundering, such as the identification process.
The final issue is a lack of ongoing development of the assessment process. Both money laundering and terrorist finance continuously evolve to evade law enforcement and find legal loopholes. Similar to law enforcement and investigators, criminal organizations often adopt new technology and develop complex methods to avoid detection. Furthermore, the legal, socio-political, or other national circumstances may change, requiring adaptation. Developing new methods requires a comprehensive understanding of the assessment process and the use of previous statistics and assessments for improved decision-making.
However, the risk assessment process should also remain consistent, from a perspective of utilizing similar evidence-based quantitative and qualitative indicators. The growth should focus on eliminating methodological flaws and adding new trusted data sources (Financial Action Task Force 18). Also, any assessment or method changes, as well as assessment conclusions, should be shared among national and international organizations to ensure that similar approaches and analytical data are used for improved comparisons.
Financial Action Task Force. Money Laundering & Terrorist Financing Risk Assessment Strategy. 2008. Web.