Palestine Monetary Authority

Circular No. (2021/43)
To all banks operating in Palestine
Date: Monday, 01 March, 2021

Subject: High-Risk Countries and Countries Under Enhanced Monitoring

Attached is a copy of the decision issued by the Financial Follow-Up Unit No. (2021/1) dated 2021/02/28 concerning high-risk countries and countries under enhanced monitoring according to the list issued by the Financial Action Task Force (FATF).

Accordingly, all banks operating in Palestine are requested to take the necessary legal measures to implement the requirements of the aforementioned decision and the measures that must be taken in this regard.

Supervision Group
Palestine Monetary Authority

Copy: The Honorable Financial Follow-Up Unit

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Ramallah & Al-Bireh Governorate - Palestine P.O. Box 452 info@pma.ps | Fax: +970 2 2415310 | Tel: +970 2 2415251 Gaza - Palestine P.O. Box 4026 www.pma.ps

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Financial Follow-Up Unit

State of Palestine

Decision No. (2021/1)
Issued by the Financial Follow-Up Unit
Date: 2021/02/28

Concerning lists of high-risk countries and countries under enhanced monitoring

Based on the provisions of Law No. (20) of 2015 concerning the prevention of money laundering and terrorist financing and its amendments, particularly paragraph (16) of Article (20),

And based on the decision of the National Committee for Combating Money Laundering and Terrorist Financing No. (8/J/2016) issued on 2016/12/01, concerning the delegation to the Financial Follow-Up Unit to publish the list of high-risk countries issued periodically by the Financial Action Task Force (FATF), and subsequently what was decided by the Group on 2020/02/21, 2020/10/23, 2020/12/18, and 2021/02/25,

And in accordance with the decision of the National Committee for Combating Money Laundering and Terrorist Financing No. (T/5/2020) issued on 2020/02/24 concerning high-risk countries and countries under enhanced monitoring,

And subsequently to the decision of the Follow-Up Unit No. (2020/1) dated 2020/02/25, Decision No. (2020/2) dated 2020/12/14, and Decision No. (2020/3) dated 2020/12/20 concerning lists of high-risk countries and countries under enhanced monitoring.

And based on the requirements of public interest, it has been decided as follows:

First
List of High-Risk Countries (Black List)

Continuation of the application of countermeasures against high-risk countries as required by Item (Second) of the Financial Follow-Up Unit Decision No. (2020/1), where the list of high-risk countries consists of the following countries:

1. Democratic People's Republic of Korea (North Korea).
2. Islamic Republic of Iran (Iran).

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Financial Follow-Up Unit

State of Palestine

Second
List of Countries Under Enhanced Monitoring (Grey List)

Amendment of the list of countries under enhanced monitoring (Grey List) stipulated in the Unit's Decision No. (2020/3) by adding (Burkina Faso, Cayman Islands, Kingdom of Morocco, and Republic of Senegal) and continuing to apply the measures stipulated in Item (Fourth) of the Financial Follow-Up Unit Decision No. (2020/1) to the countries on the grey list (which are now represented by the countries shown below), taking into account the risks related to deficiencies in the anti-money laundering and counter-terrorist financing systems of these countries as explained in mutual evaluation reports and also in Attachment No. (1) to this decision.

No.	Country Name	No.	Country Name
1	Republic of Albania	11	Republic of Panama
2	Barbados	12	Syrian Arab Republic (Syria)
3	Republic of Botswana	13	Republic of Uganda
4	Kingdom of Cambodia	14	Republic of Yemen (Yemen)
5	Republic of Ghana	15	Burkina Faso
6	Jamaica	16	Cayman Islands
7	Republic of Mauritius	17	Kingdom of Morocco
8	Republic of Antigua and Barbuda (Myanmar)	18	Republic of Senegal
9	Republic of Nicaragua	19	Zimbabwe
10	Islamic Republic of Pakistan (Pakistan)

Third
Implementation

All financial institutions, businesses, and designated non-financial businesses and professions shall implement the provisions of this decision, and it shall be effective from the date of its circularization.

Director of the Financial Follow-Up Unit
A. Wael Lavi

Attachment No. (1): Concerns related to deficiencies in the anti-money laundering and counter-terrorist financing system

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Attachment No. (1) to Unit Decision No. (2021/1)

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Attachment to Financial Follow-Up Unit Decision No. (2021/1)

Concerning lists of high-risk countries and countries under enhanced monitoring

Concerns related to deficiencies in anti-money laundering and counter-terrorist financing systems in countries under enhanced monitoring.

Part One: Deficiencies through Evaluation Reports

Mutual evaluation reports and follow-up reports published on the FATF website contain all deficiencies and key conclusions regarding the anti-money laundering and counter-terrorist financing system in countries listed on the enhanced monitoring list, where such data must be taken into consideration. These reports can be obtained via the following mechanism:

1. Access the website http://www.fatf-gafi.org
2. Select the item (publications) then (mutual evaluations)
3. Search for the country name in English in the search window.

As shown in the image shown beside.

Part Two: Implementation of Action Plans to Address Deficiencies

The following countries have made a high-level political commitment to address strategic deficiencies related to anti-money laundering and counter-terrorist financing systems, and these countries are still implementing their commitments to address remaining deficiencies.

The items below outline the key axes that those countries are working to address or have addressed, which depend on the specific deficiencies identified in mutual evaluation reports and follow-up reports, where they must be taken into consideration whether negative or positive:

Country	Key Axes
Albania	Since February 2020, when Albania made a high-level political commitment to work with the FATF and MONEYVAL to strengthen the effectiveness of its AML/CFT regime, Albania has taken steps towards improving its AML/CFT regime, including by ensuring that DNFBP supervisors take a risk-based approach and incorporate AML/CFT components into their inspections and by enhancing regular outreach to FIs and DNFBPs regarding targeted financial sanctions obligations. Albania should continue to work on implementing its action plan to address its strategic deficiencies, including by:
(1) finalizing a project to reduce the informal, cash-based economy and to register ownership of all real estate; (2) improving the timely handling of mutual legal assistance requests; (3) establishing more effective mechanisms to detect and prevent criminals from owning or controlling DNFBPs, including by strengthening competent authorities’ powers to apply sanctions; (4) ensuring that accurate and up-to-date legal and beneficial ownership information is available on a timely basis; (5) increasing the number and improving the sophistication of prosecutions and confiscations for ML, especially in cases involving foreign predicate offenses or third-party ML; and (6) improving the implementation of targeted financial sanctions through supervisory actions that identify and rectify compliance deficiencies.

| Barbados (Statement from February 2020) | In February 2020, Barbados made a high-level political commitment to work with the FATF and CFATF to strengthen the effectiveness of its AML/CFT regime. Since the completion of its MER in November 2017, Barbados has made progress on a number of its MER recommended actions to improve technical compliance and effectiveness, including by updating the National Risk Assessment and developing mitigating measures. Barbados will work to implement its action plan, including by:
(1) demonstrating it effectively applies risk-based supervision for FIs and DNFBPs; (2) taking appropriate measures to prevent legal persons and arrangements from being misused for criminal purposes, and ensuring that accurate and up to date basic and beneficial ownership information is available on a timely basis; (3) increasing the capacity of the FIU to improve the quality of its financial information to further assist law enforcement authorities in investigating ML or TF; (4) demonstrating that money laundering investigations and prosecutions are in line with the country’s risk profile and reducing the backlog to complete prosecutions that result in sanctions when appropriate; (5) further pursuing confiscation in ML cases, including by seeking assistance from foreign counterparts.

| Botswana | Since October 2018, when Botswana made a high-level political commitment to work with the FATF and ESAAMLG to strengthen the effectiveness of its AML/CFT regime and address any related technical deficiencies, Botswana has taken steps towards improving its AML/CFT regime, including by implementing risk-based supervision or monitoring programmes. Botswana should continue to work on implementing its action plan to address its strategic deficiencies, including by:
(1) improving the dissemination and use of financial intelligence by the FIU and others to identify and investigate ML cases; (2) implementing a CFT strategy, and improving the TF investigation capacity of the law enforcement agencies; (3) ensuring the implementation without delay of targeted financial sanctions measures related to proliferation financing; and (4) applying a risk-based approach to monitoring NPOs. The FATF notes Botswana’s continued progress across its action plan, however a number of its action plan deadlines have expired or will soon expire and work remains. The FATF encourages Botswana to continue to work on implementing its action plan to address the above mentioned strategic deficiencies as soon as possible.

| Burkina Faso | In February 2021, Burkina Faso made a high-level political commitment to work with the FATF and GIABA to strengthen the effectiveness of its AML/CFT regime. Since the completion of its MER in 2019, Burkina Faso has made progress on a number of its MER recommended actions to improve technical compliance and effectiveness, including by adopting a national AML/CFT strategy in December 2020. Burkina Faso will work to implement its action plan, including by:
(1) adopting and implementing follow-up mechanisms for monitoring actions in the national strategy; (2) seeking MLA and other forms of international cooperation in line with its risk profile; (3) strengthening of resource capacities of all AML/CFT supervisory authorities and implementing risk based supervision of FIs and DNFBPs; (4) maintaining comprehensive and updated basic and beneficial ownership information and strengthening the system of sanctions for violations of transparency obligations; (5) increasing the diversity of STR reporting; (6) enhancing FIU’s human resources through additional hiring, training and budget; (7) conduct training for LEAs, prosecutors and other relevant authorities; (8) demonstrating that authorities are pursuing confiscation as a policy objective; (9) enhancing capacity and support for LEAs and prosecutorial authorities involved in combatting TF, in line with the TF National Strategy; and (10) implementing an effective targeted financial sanctions regime related to terrorist financing and proliferation financing as well as risk-based monitoring and supervision of NPOs.

| Cambodia | Since February 2019, when Cambodia made a high-level political commitment to work with the FATF and APG to strengthen the effectiveness of its AML/CFT regime and address any related technical deficiencies, |