AML Country Risk Ratings

30 Nov 2017

Money laundering is a process whereby money obtained as a result of illegal activities (fraud, corruption, etc.) is transformed into other funds or investments in order to conceal the money’s real origin. Every country has its own level of money laundering risk, which is affected by various factors.

On the basis of the laws and other regulations of the Republic of Latvia, Transact Pro has created an AML risk ratings map of countries, taking into account various factors.

The map clearly shows which regions are currently considered areas of low, medium, high and very high AML risk.

The low-risk area mostly includes countries that have laws that are in compliance with international regulations, a stable government, a low risk of corruption and are not facing sanctions. The medium-risk area includes countries that could land in both either the low- or high-risk area depending minor changes in the assessment. The high-risk area mostly includes countries that are politically and economically unstable, for instance, most of the countries located in the north of Latin America, as well as Africa and the Middle East. This group also includes countries that are subject to international sanctions, as well as several stable countries whose laws are not strict enough in the area of AML.

The AML risk map was created on the basis of various sources, and following information was used to form an evaluation:

  • Offshore jurisdictions
  • Sanctions
  • The FATF AML Deficient List
  • FATF high-risk and non-cooperative jurisdictions
  • Corruption index
  • AML index
  • Weaknesses in government legislation to combat money laundering
  • Shell company indicators
  • The political index

The risk map is only meant to be informative in nature.