CBC hails progress in Moneyval’s latest anti-money laundering report
The Central Bank of Cyprus (CBC) on Thursday welcomed Moneyval’s recognition of the country’s efforts to strengthen its anti-money laundering and counter-terrorist financing framework.
“Cyprus continues to strengthen its legal and regulatory framework to combat money laundering and terrorist financing,” the CBC said in an official statement.
The comment followed the publication of the 4th Enhanced Follow-up Report and Technical Compliance Re-Rating issued on Wednesday by Moneyval.
Moneyval is the Council of Europe’s committee of experts on the evaluation of anti-money laundering measures and the financing of terrorism.
“This latest upgrade demonstrates the tangible progress Cyprus has made,” the CBC said.
Moneyval’s new report highlights significant progress by Cyprus, particularly regarding Recommendation 13, which concerns correspondent banking relationships.
The country’s compliance rating in this area has been upgraded from “partially compliant” to “largely compliant”.
“This development confirms our ongoing commitment to monitoring and strengthening the framework continuously,” the central bank stated.
According to Moneyval, Cyprus has addressed previous technical deficiencies related to correspondent banking, aligning more closely with the standards set by the Financial Action Task Force (FATF).
The central bank stressed that maintaining and enhancing this framework is essential for attracting quality investments.
“Such progress is a vital ingredient for sustaining and further strengthening financial stability,” the CBC said.
The report also reviewed compliance across the full set of FATF recommendations.
Cyprus is now rated as compliant with 16 recommendations, largely compliant with 22, and partially compliant with two.
Importantly, none of the recommendations are assessed as non-compliant.
However, the report mentioned that moderate deficiencies persist in relation to compliance by non-profit organisations.
As a result, this sector remains rated as “partially compliant”.
Moneyval also acknowledged recent steps taken by the Cypriot authorities to address these shortcomings.
The Interior Ministry completed a comprehensive risk assessment of the non-profit organisation sector, culminating in the publication of the terrorist financing risk assessment report in November 2024.
The assessment evaluated terrorist financing threats by analysing law enforcement data, suspicious transaction reports, open-source intelligence, and vulnerabilities in governance, transparency and financial controls.
Despite the progress, however, Cyprus will remain under Moneyval’s enhanced follow-up procedure.
The Republic is expected to report back within two years on further progress made in strengthening its anti-money laundering and counter-terrorist financing system.