Specific Risk Factors in the Laundering of Proceeds of Corruption – Assistance to reporting institutions


The 2011 FATF publication Laundering the Proceeds of Corruption discussed the interrelationship between corruption and money laundering.  It identified the most common methods used to launder the proceeds of corruption, and highlighted the vulnerabilities leading to an increased risk of corruption-related money laundering.  The publication also identified areas in which future work could be done, including gaining an understanding of the correlation between certain risk factors and corruption.

The report Specific Risk Factors in the Laundering of Proceeds of Corruption was written to assist reporting institutions to better analyse and better understand specific risk factors that may assist them in identifying situations posing a heightened risk of corruption-related money laundering risk.

The new FATF Recommendations  require a reporting entity to have “appropriate” risk management systems in place to determine whether the customer or the beneficial owner is a foreign politically exposed person (PEP), and take “reasonable measures” to determine whether a customer or beneficial owner is a domestic PEP or an individual entrusted with a prominent function by an international organisation. To gauge whether a system is “appropriate,” or whether “reasonable measures” have been taken, requires an assessment of risk.

Press release link: click here

Direct link to report: click here