The anti-money laundering agency of the Council of Europe, MONEYVAL, released a fresh follow-up report yesterday and commended Hungary's "improved" efforts to combat money laundering and terrorist funding.
According to the study, Hungary has significantly increased its compliance with Financial Action Task Force (FATF) requirements.
In three areas: correspondent banking relationships, internal controls in financial institutions, and transparency and beneficial ownership (BO), Hungary has been upgraded from "mainly compliant" to "largely compliant."
Today's examination focused on Hungary's enhanced due diligence obligations for correspondent banking relationships, as well as responsibilities for registered financial groups and companies.
MONEYVAL has examined a number of legislative, regulatory, and institutional reforms undertaken by Hungary in these areas, but due to procedural limits, it has not evaluated how successfully these reforms have been implemented in practise.
MONEYVAL has witnessed a number of positive developments, including the "approved changes" to the Companies Register, which establish the requirements for ensuring the accuracy of the essential information of legal persons submitted to the register.
The government of Hungary has put requirements on financial institutions regarding worker screening and ongoing education.
The study indicates that Hungary has satisfied MONEYVAL's general expectation that, by five years of the mutual assessment report's implementation, the most, if not all, technical compliance deficiencies will have been resolved.
Five of the worldwide AML/CFT standard's forty FATF Recommendations have been completely implemented in the jurisdiction.
Hungary's execution of 32 Recommendations, while it has been declared "mostly compliant," nonetheless has minor weaknesses.
Three Recommendations (concerning non-profit organisations, new technologies, and cash couriers) are still "partially compliant." Hungary does not have any "non-compliant" ratings.
Hungary will be watched more carefully and will continue to report to MONEYVAL on its progress in enhancing its anti-money laundering (AML) and counter-terrorist financing (CFT) measures; a follow-up report is due in two years.
By fLEXI tEAM