Money laundering is a major threat to good governance and the rule of law insofar as it can distort markets and the wider financial system, and facilitate and conceal underlying crimes, including terrorism. Effective policies and measures to combat money laundering and the financing of terrorism (AML/CFT) are therefore essential to support Ukraine's long-term recovery and sustainable development.
In 2022, the third AML/CFT/CPF National Risk Assessment identified three high-level threats to Ukraine's national financial system: 1. money laundering in the context of military aggression against Ukraine; 2. money laundering through remote services or using virtual assets; and 3. illegal financial flows from the country.
UNODC through its Global Programme against Money Laundering UNODC GPML is implementing a project entitled: 'Support for the State Financial Monitoring Service of Ukraine (SFMS) and Ukrainian authorities in increasing the capacity to detect, investigate and prosecute money laundering offences' (ref. frame on 'Prevention and Responses Interventions 2023-2024'). Funded by the Government of the Federal Republic of Germany, the overall objective of the project is to enhance the effectiveness of national competent authorities in conducting money laundering investigations.
"To combat financial crime and underlying criminal activities, UNODC in Ukraine coordinates with a wide network of international partners to support the government. Together, we have developed a conceptual understanding and guidelines for combating financial crimes and comprehensive anti-money laundering interventions in line with national strategies. These interventions represent a step forward in improving Ukraine's resistance to money laundering activities, contributing to a safer investment climate and sustainable economic growth while promoting good governance and the rule of law."
Harsheth Virk (Head of Office - UNODC in Ukraine)
To achieve the project's objectives, UNODC has coordinated with the State Financial Monitoring Service of Ukraine (SFMS) and the Academy of Financial Monitoring to implement an anti-money laundering capacity building project. Based on the gaps identified to improve the qualifications of national anti-money laundering entities and develop the national anti-money laundering training infrastructure, the activities enabled AML national trainers to acquire updated knowledge, skills as well as technological approaches and tools to proactively address current and emerging threats (ref. frames on Interventions Phase I and II).
During the first phase of the project in 2023 (read the webstory), UNODC supported SFMS to develop training materials for "training of trainers", and support the delivery of courses to the SFMS Academy and national AML trainers on four key themes: Open source intelligence (OSINT), Beneficial Ownership (BO), Financial Investigation (FI), Trade-based Money Laundering (TBML).
In the second phase of the project from April to June 2024, UNODC in Ukraine will provide software licenses to support anti-money laundering investigations and equip the Academy of Financial Monitoring with technical equipment and IT systems to enable national trainers to deliver the training materials and courses developed during the first phase through inter-agency trainings.
Money laundering and underlying crimes can threaten the integrity and stability of countries' financial sector and, more generally, their external stability. UNODC supports Ukraine in the effective implementation of policies, measures and tools to prevent and combat financial crime, and to protect the integrity and stability of the national financial system. The aim is to support Ukraine to achieve the Sustainable Development Goals (SGD 16.4 "Reduce significantly illicit financial and arms flows, strengthen the recovery and restitution of stolen assets and combat all forms of organized crime") and to strengthen the anti-money laundering architecture that complies with international standards, including the European Union's AML Guidelines and the Financial Action Task Force FATF and its regional body MONEYVAL of which Ukraine is a member.
Further Information
UNODC promotes a collaborative approach with other international and regional organizations engaged in AML, such as the EU, OSCE, IMF, Council of Europe, Basel Institute on Governance, World Bank. This coordination effort, through shared activity matrix and regular meetings monthly facilitated by UNODC, aims at deconflicting all capacity building exercises and ensures synergies when applicable.
The Financial Action Task Force (FATF): The Global Network, comprises the FATF (Flyer) and the nine FATF-Style Regional Bodies (FSRB). The active participation of the FSRBs in the work of the FATF is crucial to ensure a global implementation of effective measures to combat money laundering and terrorist financing. The Global Network brings together more than 200 governments and 20 observer international organisations.
MONEYVAL: The Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism MONEYVAL is a permanent monitoring body of the Council of Europe entrusted with the task of assessing compliance with the principal international standards to counter money laundering and the financing of terrorism and the effectiveness of their implementation, as well as with the task of making recommendations to national authorities in respect of necessary improvements to their systems. Through a dynamic process of mutual evaluations, peer review and regular follow-up of its reports, MONEYVAL aims to improve the capacities of national authorities to fight money laundering and the financing of terrorism more effectively (See MONEYVAL Strategy on anti-money laundering, combating the financing of terrorism and proliferation financing 2023-2027).
