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In this article we explore MONEYVAL.

What is MONEYVAL?

Six things you should know.

The word ‘MONEYVAL’ is being mentioned quite frequently in local media as of late, so we thought we’d dive in and explain what it is and why it exists in the below six simple facts.

  1. What is MONEYVAL?

MONEYVAL is concerned with anti-money laundering and counter-terrorist financing. Money laundering is a huge international problem, in fact, in 2018 it was reported that between $500B to $1T is laundered around the globe. Not only is money laundering morally incorrect and a criminal offence, when money cannot be accounted for, or when it is distributed in an illegitimate manner, it can have devastating effects on citizens, employees, sectors, local economies, and global infrastructures. Its goal is to prevent devastation before it happens.

  1. Who is MONEYVAL?

MONEYVAL (which stands for the Committee of Experts on the Evaluation of AntiMoney Laundering Measures and the Financing of Terrorism) was created by The Council of Europe back in 1997. It is a permanent monitoring body tasked to evaluate its member states and territories against anti-money laundering and counter-terrorist financing international standards and the effectiveness of their implementation. It also has the task of making recommendations to national authorities in respect of necessary improvements to their systems. MONEYVAL, therefore, aims to improve the capacities of national authorities to fight money laundering and the financing of terrorism more effectively.

  1. Who is part of MONEYVAL?

Member states should not be confused with being European Union member states. Member states include European countries but also include non-member states of the European Union such as; The Russian Federation, Israel, Vatican City State, The UK Crown Dependencies of Jersey, Guernsey and the Isle of Man.

Any member state that is a part of MONEYVAL has agreed to comply to a global standard of compliance. To date, 34 Member states are subject to AML/ CFT evaluations; 32 of them are solely evaluated by MONEYVAL, while two states (Russian Federation and Israel) are jointly evaluated by the FATF and MONEYVAL.

Moneyval annual report

  1. What are MONEYVAL rounds?

To date, MONEYVAL have done five rounds of ‘mutual evaluations’. With that said, it would be incorrect to think that once a jurisdiction is evaluated the job is done. They do several follow-ups to ensure standards are maintained and any recommendations for improvements are implemented in a timely manner. One can comprehend this a little better when understanding the longevity or each round.

They works in ‘rounds’ which span over a number of years to ensure all member states are covered. Its first evaluation round spanned from 1998 to 2000. Its second evaluation round took place from 2001 to 2004. Its third round ran from 2005 to 2009, its fourth from 2009 to 2015, and its 5th evaluation round has been in progress since 2015 and shall continue until 2021.

  1. What are ‘Mutual Evaluation’ reports?

On an annual basis, MONEYVAL publishes a report containing the activities undertaken, as well as information on the state of compliance with AML/CFT international standards in the States and territories that have been evaluated in the previous year. It covers the methodology used and contains summaries of the jurisdictions evaluated as well as follow-ups that were held during the previous period.

Further to this, they also provide comprehensive jurisdiction-specific reports. In these reports, they documents the jurisdiction’s ability to monitor, manage and report money laundering and terrorist financing.

MONEYVAL’s reports are considered highly reputable sources of information for the general public as well as financial institutions.

  1. What is the connection to FATF?

MONEYVAL works with the Financial Action Task Force (FATF) as a primary international partner and collaborator. MONEYVAL works autonomously from FATF, but co-operates closely with it as well as with other FATF-style regional bodies (FSRBs). Furthermore, MONEYVAL and the FATF also undertake joint evaluations for certain specific jurisdictions.  This relationship is crucial, as FATF is a policy-making body that pushes for national legislation and regulatory reform.

MONEYVAL also has relationships with several international bodies of influence to ensure that its voice is resonated globally. Such alliances include but are not limited to; The European Union, United Nations, The International Monetary Fund and World Bank.