On 2 September 2020, MONEYVAL (the Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism) published a report detailing the money laundering and terrorist financing trends emanating from the Covid-19 pandemic, identified through feedback from jurisdictions within MONEYVAL’s remit.
MONEYVAL notes that, so far during the pandemic, whilst the level of general criminal activity has remained constant, certain types of crime which generate criminal proceeds have increased (such as fraud and cybercrime). In addition, criminals have sought to capitalise on other aspects of the pandemic, such as a relaxation in controls to enable the delivery of personal protective equipment (PPE) and exploitation of relief measures introduced by tax authorities to support vulnerable members of the community. Based on feedback, MONEYVAL has identified 5 areas of potential money laundering threats directly stemming from the pandemic, which are: fraud; “medicrime” (crimes related to the provision of medical equipment/supplies); corruption; cybercrime; and late demand in moving illicit funds.
To support jurisdictions in responding to emerging and continuing risks, MONEYVAL provides a set of 7 recommendations which it urges that jurisdictions:
- Apply extra vigilance in complying with international standards set out by the Financial Action Task Force (FATF).
- Continue to support and communicate with the private sector, and not just credit institutions, to tackle risks identified.
- Make adjustments to the application of a risk-based approach to adapt to the current and changing risk exposures.
- Encourage use of innovation to support supervisory and ongoing monitoring activities.
- Continue efforts to foster cross-border information sharing and transparency.
- Enhance domestic information sharing between national financial intelligence units (FIUs) and law enforcement authorities (LEAs) to both enhance investigations and share insights on new typologies and emerging trends.
- Continue to monitor the impact of Covid-19 on national anti-money laundering and counter-terrorist financing mechanisms and take measures as appropriate to mitigate risk.
Finally, MONEYVAL identifies that there have been a number of positive process and practice evolutions brought about by the pandemic. In particular, in the absence of site visits, regulators have adapted to using screen-sharing and secure electronic file sharing to continue monitoring activity. In addition, international cooperation has not been negatively impacted by the pandemic.