Sun, Jun 30, 2019 - Page 1 News List

Peer review shows lowest risk of money laundering

Staff writer, with CNA

Taiwan came through the third round of a peer review of its efforts to prevent money laundering with flying colors, the Executive Yuan’s Anti-Money Laundering Office said in a statement on Friday.

Following an assessment by members of the Asia/Pacific Group on Money Laundering (APG), the group promoted Taiwan from “enhanced follow-up” to “regular follow-up,” indicating the lowest risk of money laundering, the group said in a report.

The APG uses “mutual evaluation,” or peer review, to assess the degree to which its members comply with international standards in combating money laundering and terrorist financing.

A third-round peer review has, from worst to best, four possible outcomes: non-cooperation, transitional follow-up, enhanced follow-up and regular follow-up.

A bad score can hurt the reputation of a nation’s financial sector and put it at a major disadvantage in engaging in international finance.

Taiwan made it onto the “regular follow-up” list after achieving “substantial” marks on seven of 11 factors used to measure a nation’s effectiveness in fighting money laundering, the office said.

Each factor receives a rating of “high,” “substantial,” “moderate” or “low” effectiveness.

The APG report is to be forwarded to the Paris-based Financial Action Task Force — which has 35 member jurisdictions and two regional organizations, representing most major financial centers in all parts of the globe — for further comment, as well as to international organizations such as the IMF and the World Bank, the office said.

A final report on the third-round peer review is to be presented for membership approval at the APG annual meeting in Canberra on Aug. 22, it said.

Before the annual meeting, institutions and individuals in Taiwan are to continue efforts against money laundering, showing the world its determination to maintain financial order and helping it to garner member nations’ votes and pass the latest review, the office said.

The APG’s peer review has continued over nearly 10 years, it said, adding that the results of the evaluation have aided Taiwan in stabilizing its financial markets and helped foreign investors in studying the feasibility of local investment by understanding the flow of money in and out of the nation.

The improvement in review results is expected to benefit Taiwan’s economic development over the long term and boost the possibility of its participation in international organizations, the office said.

As part of the review and Taiwan’s efforts against money laundering, the government set up the Anti-Money Laundering Office on March 16, 2017. The office coordinates the resources of 37 government agencies and 31 local industries to improve Taiwan’s score in the peer review.

Taiwan was placed on the “regular follow-up” list in 2007 and was demoted to the “enhanced follow-up” list by the APG in 2011, before being placed on the “transitional follow-up list” in 2014. It was removed from the transitional list on July 20, 2017, pending the results of the current evaluation.

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