Iceland's progress in strengthening measures to tackle money laundering and terrorist financing

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Follow-Up Report Iceland 2019

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Iceland's progress in strengthening measures to tackle money laundering and terrorist financing

5 September 2019 – Since the 2018 Assessment of Iceland’s measures to tackle money laundering and terrorist financing, the country has taken a number of Follow-Up Report Iceland 2019to strengthen its framework.

Iceland has been in an enhanced follow-up process following the adoption of its mutual evaluation in 2018. In line with the FATF Procedures for mutual evaluations, the country has reported back to the FATF on the action it has taken since then.

To reflect Iceland’s progress, the FATF has now re-rated the country on the following Recommendations:

9 – Financial institution secrecy laws from largely compliant to compliant
10 – Customer due diligence from partially compliant to compliant
12 – Politically exposed persons from partially compliant to compliant
15 – New technologies from partially compliant to largely compliant
16 – Wire transfers from partially compliant to compliant
17 – Reliance on third parties from partially compliant to compliant
19 – Higher-risk countries from partially compliant to compliant
20 – Reporting of suspicious transactions from largely compliant to compliant
22 – Designated non-financial businesses and professions (DNFBPs): customer due diligence from partially compliant to compliant
23 – Designated non-financial businesses and professions (DNFBPs): Other measures from partially compliant to largely compliant
27 – Powers of supervision from largely compliant to compliant
28 – Regulation and supervision of DNFBPs from non compliant to partially compliant
35 – Sanctions from partially compliant to largely compliant

The report also looks at whether Iceland’s measures meet the requirements of FATF Recommendations that have changed since the 2018 mutual evaluation. The FATF agreed to maintain the rating of Partially compliant for Recommendation 2 (National co-operation and co-ordination) and Recommendation 7 (Targeted financial sanctions related to proliferation) re-rate Recommendation 18 (Internal controls and foreign branches and subsidiaries) to Largely compliant; and maintain Recommendation 21 (Tipping-off and confidentiality) as Compliant.

Today, Iceland remains partially or non-compliant on 12 of the 40 Recommendations. It is compliant on 14 Recommendations and Largely Compliant on 14 Recommendations. Iceland will continue to report back to FATF on its progress.