MONEYVAL, a body of the Council of Europe, has been an associate member of FATF since 2006. It assesses compliance with international standards against money laundering and financing. MONEYVAL's mutual evaluation process helps member states to deal with AML and CFT with regular reports and peer reviews. The goal is to ensure that member states have effective systems against AML/CFT and comply with international standards in this regard.
Poland's AML/CFT System
The FATF report highlights Poland's AML/CFT system's measures and makes suggestions on its effectiveness and how the system can be strengthened. It also analyzes Poland's compliance with the FATF 40 recommendations. Although the terrorist threat is considered low in Poland, the country is exposed to several risks such as corruption, drugs, money laundering from human trafficking, financing of terrorism, and tax crimes, according to the first national risk assessment (NRA) in 2019. Crimes related to smuggling of migrants, crimes against property and economic transactions, infringement of copyright and industrial property rights pose a high risk of money laundering from international and local criminal groups.
Legal Framework and Priority Actions
After the evaluation, Poland tried to strengthen the AML/CFT laws and reduce risks. However, activating the laws is crucial. According to the report, authorities need to criticize and interpret the criminal justice system and international cooperation activity. They also need to implement a mechanism that systematically collects comparable statistics to enable authorities to evaluate it. Appropriate analysis and reasonable conclusions are required, as authorities are limited in understanding money laundering in certain premise crimes. In particular, monitoring the financial activities and cash movement transfers of individuals, groups, and organizations interested in infiltrating the AML/CFT system carried out through the Hawala networks in the country is necessary. Deposit legislation is required to comply with FATF recommendations. Poland needs to take urgent action to ensure that the seizure of criminal proceeds, vehicles, and comparable property is pursued as a policy objective. A consistent implementation should be developed to improve the asset tracking, seizure, and recovery aspect of investigations.
Supervision should be increased in all regulated institutions, and inspection must include hand coordination and monitoring by GIFI. Technical deficiencies under R30 and 32 must be addressed for measures to be taken to ensure that CFT is a crime in itself and not a by-product of terrorism. Poland should address existing gaps in the prevention of criminal control of regulated institutions. The private sector is better at dealing with AML/CFT risks, but countermeasures against terrorist financing exploitation by the nonprofit sector should be implemented. Awareness-raising activities should be carried out in the private sector, and authorized persons should be educated about TFS liabilities related to money laundering.
The Role of FATF and MONEYVAL in International Standards
FATF and the MONEYVAL play a crucial role in promoting international AML/CFT standards and best practices.
FATF, established in 1989, is an intergovernmental organization that sets global standards for combating money laundering and terrorism financing. It has an objective to protect the integrity of the financial system by preventing the use of financial institutions for illegal purposes. FATF’s recommendations are not legally binding, but member countries are required to implement them and undergo regular assessments to ensure compliance.
MONEYVAL, on the other hand, is a monitoring body that evaluates member countries’ compliance with international AML/CFT standards. MONEYVAL’s mutual evaluation process enables countries to better deal with AML/CFT with regular reports and peer reviews. Its goal is to ensure that member states have effective systems against AML/CFT and comply with international standards in this regard.
The Role of International Cooperation and Coordination
In Poland, international cooperation and coordination play a crucial role in combating money laundering and terrorism financing. As mentioned in the FATF report, Poland faces a range of risks related to corruption, drugs, money laundering from human trafficking, financing of terrorism, tax crimes, and more. These risks are not unique to Poland and require a coordinated effort among countries to address them effectively.
International cooperation encourages countries to share intelligence and work in coordination with their efforts to combat financial crime, especially AML/CFT. It includes strategies like working together to identify, investigate, and prosecute individuals and organizations involved in these illegal activities. Poland has taken steps to strengthen its international cooperation and coordination efforts, as evidenced by its membership in MONEYVAL and the country’s active participation in the international AML/CFT framework.
Moreover, international cooperation helps countries to identify new risks and emerging trends in money laundering and terrorism financing. This is particularly important as criminals are constantly developing new ways to launder money and finance terrorism. By working together, countries can stay ahead of the curve and develop effective strategies to combat these illegal activities.
Sanction Scanner Compliance Software
The report suggests that businesses in Poland can minimize their AML and CFT risks with Sanction Scanner compliance software. Some measures are taken within the scope of the proposed legislation, such as KYC, CDD, Transaction Screening, and Transaction Monitoring. With Sanction Scanner's AML compliance solutions, businesses can comply easily with regulatory authorities in Poland and the changes made to strengthen the AML/CFT laws. The software minimizes the risks to businesses and saves them time.
To strengthen its AML/CFT system, Poland needs to align the risk assessment results with AML/CFT policies and make institutional and operational changes. A comprehensive set of criteria for prioritizing suspicious transaction reports and related analytical transactions must be developed and implemented. Resources should be made available to allow risk-based supervision.