Belgium's measures to counter money laundering, terrorist financing and proliferation financing

• Belgium has a generally satisfactory understanding of its money laundering and terrorist financing risks, with regularly updated national risk analyses, but improvements are still needed - particularly with regards to risks associated with virtual assets (VA).
• Prominent areas of risk include VAs, drug and cash trafficking, professional money launderers, and organised crime networks.
• The country sees a high level of interconnection between criminal activities, with increasing links between money laundering and terrorist financing.
• The main terrorist financing threat in Belgium relates to ex-foreign terrorist fighters and radicalised individuals, via micro-financing involving new payment methods and small cash transactions.

• A major issue in Belgium is the persistent lack of resources allocated to the fight against money laundering. This shortage impacts the country’s ability to effectively investigate and prosecute money laundering and predicate offences.
• A strategic approach, based on clear priorities and backed by adequate resources, is needed in order to comprehensively tackle the major crime patterns developing in the country.
• Institutional and operational cooperation in the anti-money laundering area is generally effective, but that coordination in the counter-terrorist financing field could be improved by associating terrorist financing experts more closely with terrorism experts.

• Belgian authorities make regular and fairly systematic use of informal cooperation to support their AML/CFT activities and provide high-quality support to their counterparts. 
• Belgium has engaged in numerous collaborations with foreign partners in order to facilitate and accelerate international cooperation. Some of these initiatives have already produced results and should be accelerated to maximise their full impact and ensure their long-term implementation.
• Belgium should collect the necessary statistical data on mutual legal assistance and other forms of formal cooperation.  Due to a lack of comprehensive data for all public prosecutors’ offices, Belgium cannot demonstrate that its international cooperation measures are being implemented systematically whenever required, particularly for cases managed by district public prosecutors' offices outside Brussels. 

• The main supervisory authorities for financial institutions in Belgium effectively supervise market access, but the detection of illicit activities remains limited, particularly for hawala transfers and virtual assets.
• No authority has been designated in Belgium to licence and supervise virtual asset service providers, leaving this very high-risk sector without adequate oversight.  
• Financial supervisors have a generally satisfactory understanding of money laundering and terrorist financing risks, including for the higher risk financial institutions, which is reflected in supervision that is generally adapted to the levels of risk identified, based on an appropriate risk-based approach. 
• The very limited use of administrative sanctions by financial supervisors, combined with the almost non-existent or anonymous publication of decisions, considerably weakens the dissuasive effect and educational aspects of the repressive system. The effective use of these sanctions should be strengthened by adapting human resources and, if necessary, the applicable legal framework.  Supervision in non-financial sectors is fragmented and uneven. A lack of human resources has resulted in a limited number of inspections being carried out, despite high non-compliance rates.
• Competent authorities’ human and technical resources need to be strengthened to ensure a targeted and effective supervision, particularly for the sectors most at risk, such as diamond dealers.

• Belgium has a general understanding of the money laundering and terrorist financing risks to which legal persons and legal arrangements are exposed which should be further developed. 
• The creation of a beneficial owner register has enabled the country to expand its multi-pronged approach to accessing information on beneficial owners.  This register is a useful tool for accessing the necessary data. Belgium should ensure that adequate and effective verification measures are taken to guarantee that the data already recorded in the register, and to be recorded in the future, is accurate and up to date. 

• Belgium’s financial intelligence unit (FIU) (Cellule de Traitement des Informations financières, CTIF) plays a key role in producing financial intelligence for countering money laundering and terrorist financing, at both operational and strategic levels, and largely meets the operational needs of competent authorities. However, the IT tools currently available to the FIU, and use of financial intelligence by competent authorities for money laundering purposes, are insufficient. 

• Due to resource constraints, Belgium has prioritised money laundering cases based on the profitability of opening an investigation, which does not orient investigations and prosecutions towards complex cases, but rather those for which assets are immediately and easily available.
• Belgium should provide the law enforcement and judicial authorities with the human, financial and technological resources needed to tackle the root causes of the criminal activities affecting the country. 

• Belgium has a comprehensive legal framework for seizure and confiscation. However, the results of confiscations are not commensurate with national policies and priorities, and Belgium’s risk profile. 

• The assessment found that Belgium has adjusted its response to terrorism following the attacks in 2015 and 2016.
• An operational CFT strategy allows Belgium to deal with all targets likely to be involved in terrorist financing activities, however formal integration of terrorist financing is necessary into the counter-terrorism strategy, and also the operational handling of terrorist financing cases. 
• The country needs to deepen its understanding of proliferation financing risks and strengthen operational cooperation in order to ensure that the measures in place are sufficient to mitigate identified risks.

Following the assessment, Belgium received a roadmap of Key Recommended Actions that it must complete within three years, such as allocating resources and effective technological tools to the authorities responsible for the investigation and prosecution of money laundering, implementing a strategic approach to address its main money laundering and terrorist financing risks, and specifically targeting transnational organised criminal networks involved in money laundering and terrorist financing.

Based on Effectiveness and Technical Compliance Ratings, Belgium is placed in enhanced follow-up. Belgium will report back to the FATF on its progress.