Palestine Monetary Authority

(2021/195) Circular No.
To all banks operating in Palestine
Date: Tuesday, October 26, 2021

Subject: High-Risk Countries and Countries Under Enhanced Follow-Up

Attached is a copy of the decision issued by the Financial Follow-Up Unit No. (2021/3) dated 2021/10/24 regarding High-Risk Countries and Countries Under Enhanced Follow-Up 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 to be taken specifically.

Supervision Group
Palestine Monetary Authority

Copy: To the respected gentlemen/ 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 Fax: +970 8 2844487 | Tel: +970 8 2825251 www.pma.ps

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Financial Follow-Up Unit
State of Palestine

Decision No. (2021/3)
Issued by the Financial Follow-Up Unit
Date: October 24, 2021
Regarding the lists of High-Risk Countries and Countries Under Enhanced Follow-Up

Based on the ruling of Law No. (20) of 2015 regarding the combating 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. (2016/4j/8) issued on 01/12/2016, regarding the delegation of 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 Assembly since 21/02/2020, until 21/10/2021, and in addition to the decision of the National Committee for Combating Money Laundering and Terrorist Financing No. (2020/5/t) issued on 24/02/2020 regarding High-Risk Countries and Countries Under Enhanced Follow-Up, and subsequently to the Financial Follow-Up Unit decision No. (2020/1) dated 25/02/2020 and subsequent decisions regarding the lists of High-Risk Countries and Countries Under Enhanced Follow-Up.

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

First

List of High-Risk Countries (Black List)
Continuation of the application of countermeasures against High-Risk Countries listed under 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).

FINANCIAL FOLLOW-UP UNIT
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State of Palestine – Al Bireh P.O.Box 3981
Tel: +970 22422551/2 Fax: +970 22422553
E-mail: info@ffu.ps www.ffu.ps

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Financial Follow-Up Unit
State of Palestine

Second

List of Countries Under Enhanced Follow-Up (Grey List) Modification of the list of Countries Under Enhanced Follow-Up (Grey List) stipulated in the Unit's decision No. (2021/2) by deleting both (Republic of Botswana, Republic of Mauritius) from the list, and adding both (Hashemite Kingdom of Jordan, Turkish Republic, Republic of Mali) and continuing to apply the measures stipulated in item (Fourth) of the Financial Follow-Up Unit decision No. (2020/1) to the countries in the Grey List (which now consists of the countries shown in the table below), taking into account the concerns regarding 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	13	Republic of Nicaragua
2	Barbados	14	Islamic Republic of Pakistan (Pakistan)
3	Burkina Faso	15	Republic of Panama
4	Kingdom of Cambodia	16	Republic of the Philippines
5	Cayman Islands	17	Republic of Senegal
6	Republic of Haiti	18	Republic of South Sudan
7	Jamaica	19	Syrian Arab Republic (Syria)
8	Hashemite Kingdom of Jordan (Jordan)	20	Turkish Republic
9	Republic of Mali	21	Republic of Uganda
10	Republic of Malta	22	Republic of Yemen (Yemen)
11	Kingdom of Morocco	23	Zimbabwe
12	Republic of the Union of Myanmar (Myanmar)

FINANCIAL FOLLOW-UP UNIT
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State of Palestine – Al Bireh P.O.Box 3981
Tel: +970 22422551/2 Fax: +970 22422553
E-mail: info@ffu.ps www.ffu.ps

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Financial Follow-Up Unit
State of Palestine

Third

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

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

Attachment: Concerns regarding deficiencies in the anti-money laundering and counter-terrorist financing system.

FINANCIAL FOLLOW-UP UNIT
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State of Palestine – Al Bireh P.O.Box 3981
Tel: +970 22422551/2 Fax: +970 22422553
E-mail: info@ffu.ps www.ffu.ps

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Attachment
Concerns regarding deficiencies in the anti-money laundering and counter- terrorist financing system

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Attachment to Financial Follow-Up Unit Decision No. (2021/3) Regarding the lists of High-Risk Countries and Countries Under Enhanced Follow-Up

Concerns regarding deficiencies in anti-money laundering and counter-terrorist financing systems in Countries Under Enhanced Follow-Up.

Part One: Deficiencies through evaluation reports

Mutual evaluation reports and follow-up reports published on the Financial Action Task Force website contain all deficiencies and main conclusions regarding the anti-money laundering and counter-terrorist financing system in the countries listed on the Enhanced Follow-Up list, where this data must be taken into consideration, and these reports can be obtained via the following mechanisms:

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 on the search window

As shown in the image shown beside.

Part Two: Implementation of work to address deficiencies

The following countries have politically committed to addressing strategic deficiencies related to anti-money laundering and counter-terrorist financing systems, and these countries continue to take their commitments to address remaining deficiencies. The items below outline the main axes that those countries are working to address or have addressed, which depend on the specific deficiencies according to mutual evaluation reports and follow-up reports, where they must be taken into consideration whether negative or positive:

Country	Main 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 completing a long-term project to reduce the informal economy and use of cash through establishing electronic invoicing for business-to-government, business-to-business, and business-to-customer transactions. Albania should continue to work on implementing its action plan to address its strategic deficiencies, including by: (1) finalising the registration of real estate properties in Albania; (2) establishing more effective mechanisms to detect and prevent criminals from owning or controlling DNFBPs, including by passing a law on the licensing and regulation of real estate intermediaries; (3) ensuring that there are effective mechanisms for timely access
			by authorities to beneficial ownership information about companies as well as appropriate penalties for non-compliance or the provision of false information; (4) increasing the number of prosecutions for ML, especially in cases involving foreign predicate offences; and (5) demonstrating the continued use of asset seizures and securing final confiscations for the proceeds of crime, especially assets linked to third-party and professional money launderers, as well as indirect proceeds and equivalent value.
Barbados	Since February 2020, when Barbados made a high-level political commitment to work with the FATF and CFATF to strengthen the effectiveness of its AML/CFT regime, Barbados has taken steps towards improving its AML/CFT regime, including by applying risk based supervision and sanctions on FIs and TCSPs. Barbados should continue to work on implementing its action plan to address its strategic deficiencies, including by: (1) demonstrating an effective application of risk-based supervision 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) ensure its FIU’s financial information products further assist law enforcement authorities in investigating ML or TF; (4) demonstrating that ML investigations and prosecutions are in line with the country’s risk profile and result in sanctions, when appropriate, and reducing the backlog in completing cases; (5) further pursuing confiscation in ML cases, including by seeking assistance from foreign counterparts.
Burkina Faso (Statement from February 2021)	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, Cambodia has taken some steps toward improving its AML/CFT regime, including by demonstrating sanctions being applied to FIs for AML/CFT breaches. However, Cambodia should take urgent action to fully address remaining measures in its action plan as all timelines have already expired. Cambodia should therefore continue to work on implementing its action plan to address its strategic deficiencies, including by: (1) enhancing disseminations of financial intelligence to law enforcement authorities in connection with high-risk crimes; (2) demonstrating an increase in ML investigations and prosecutions in line with risk; (3) demonstrating an increase in the freezing and confiscation of criminal proceeds, instrumentalities, and property of equivalent value; (4) demonstrate that implementation of targeted financial sanctions (TFS) related to PF is occurring by providing training to strengthen the skills of competent authorities to implement PF TFS, and enhance the understanding of sanctions evasion.
The Cayman Islands	In February 2021, the Cayman Islands made a high-level political commitment to work with the FATF and CFATF to strengthen the effectiveness of its AML/CFT regime. The Cayman Islands should continue to work on implementing its action plan to address its strategic deficiencies, including by: (1) imposing adequate and effective sanctions in cases where relevant parties (including legal persons) do not file accurate, adequate and up-to-date beneficial ownership information in line with those requirements; and (2) demonstrating that they are prosecuting all types of money laundering cases in line with the jurisdiction’s risk profile and that such prosecutions are resulting in the application of dissuasive, effective, and proportionate sanctions.