Brazil's measures to combat money laundering and terrorist financing

Publication details

Language

English
Spanish
Portuguese

Country

Brazil

Mutual Evaluation Brazil - 2023

Filename
Brazil-Mutual-Evaluation-2023.pdf
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4 MB
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application/pdf
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Paris, 21 December 2023 - Brazil has made important strides to improve its system to combat money laundering and terrorist financing and is achieving some positive results. Brazil needs to strengthen cooperation and coordination between certain authorities and improve prosecution of money laundering.

The FATF/GAFILAT mutual evaluation report of Brazil underscores the country's improved international cooperation, risk assessment, and policy coordination since the last evaluation in 2010. However, key challenges remain, including the need for enhanced cooperation and coordination among authorities, particularly the Police, Prosecution Authority, and Tax Office. The country also needs to show major improvements to prosecution of money laundering, including to tackle environmental crimes and laundering of proceeds.

As a major economy in the world, Brazil has the largest banking and securities sectors in South America and as a result, is exposed to various cross-border threats, further aggravated by the porosity of the borders.

The FATF/GAFILAT mutual evaluation report of Brazil highlights that Brazil has a deep understanding of its money laundering risks, in particular for money laundering risks arising from corruption, organized crime, tax crime, drug trafficking, and environmental crimes.

Brazil demonstrated strong supervision of most of the financial sector, but the country should address the gaps in supervision of its non-financial sector which is currently leaving sectors such as lawyers completely unregulated for AML/CFT/CPF. Brazil should enhance the recovery of assets linked to crime and terrorism. With the exception of corruption-related assets, its confiscation results are not entirely in line with the risks the country faces.

Despite initiatives like REDESIM to detect misuse of companies challenges remain in ensuring full transparency of business entities, with a largely unpopulated database for beneficial ownership information.

Brazil’s measures to combat the financing of terrorism have improved in recent years but there is need for significant advancements in implementation for the measures to be more effective. The risks of terrorist financing are relatively low in Brazil, however, the country should enhance risk understanding and mitigation from terrorist financing risks.

Ratings

Effectiveness

Ratings that reflect the extent to which a country's measures are effective. The assessment is conducted on the basis of 11 immediate outcomes, which represent key goals that an effective AML/CFT system should achieve.

Ratings that reflect the extent to which a country's measures are effective. The assessment is conducted on the basis of 11 immediate outcomes, which represent key goals that an effective AML/CFT system should achieve.

Mutual Evaluation Report - Brazil 2023

IO1
SE
IO2
SE
IO3
ME
IO4
ME
IO5
ME
IO6
ME
IO7
ME
IO8
ME
IO9
ME
IO10
ME
IO11
ME

HE = high level of effectiveness   |   SE = substantial level of effectiveness    |   ME = moderate level of effectiveness   |   LE = low level of effectiveness

Technical Compliance

Ratings which reflect the extent to which a country has implemented the technical requirements of the FATF Recommendations.

Mutual Evaluation Report - Brazil 2023

R.1 - Assessing risk & applying risk-based approach
LC
R.2 - National cooperation and coordination
LC
R.3 - Money laundering offence
LC
R.4 - Confiscation and provisional measures
LC
R.5 - Terrorist financing offence
PC
R.6 - Targeted financial sanctions related to terrorism & terrorist financing
PC
R.7 - Targeted financial sanctions related to proliferation
LC
R.8 - Non-profit organisations
PC
R.9 - Financial institution secrecy laws
C
R.10 - Customer due diligence
LC
R.11 - Record keeping
C
R.12 - Politically exposed persons
LC
R.13 - Correspondent banking
C
R.14 - Money or value transfer services
C
R.15 - New technologies
PC
R.16 - Wire transfers
C
R.17 - Reliance on third parties
LC
R.18 - Internal controls and foreign branches and subsidiaries
LC
R.19 - Higher-risk countries
PC
R.20 - Reporting of suspicious transactions
LC
R.21 - Tipping-off and confidentiality
C
R.22 - DNFBPs: Customer due diligence
PC
R.23 - DNFBPs: Other measures
PC
R.24 - Transparency and beneficial ownership of legal persons
PC
R.25 - Transparency and beneficial ownership of legal arrangements
PC
R.26 - Regulation and supervision of financial institutions
LC
R.27 - Powers of supervisors
C
R.28 - Regulation and supervision of DNFBPs
PC
R.29 - Financial intelligence units
C
R.30 - Responsibilities of law enforcement and investigative authorities
C
R.31 - Powers of law enforcement and investigative authorities
C
R.32 - Cash couriers
PC
R.33 - Statistics
LC
R.34 - Guidance and feedback
LC
R.35- Sanctions
LC
R.36 - International instruments
LC
R.37 - Mutual legal assistance
LC
R.38 - Mutual legal assistance: freezing and confiscation
LC
R.39 - Extradition
LC
R.40 - Other forms of international cooperation
LC

C = compliant   |   LC = largely compliant     |   PC = partially compliant   |   NC = non-compliant

Translated documents

GAFILAT - Spanish - Mutual Evaluation of Brazil 2023

Filename
Spanish-Brazil-Mutual-Evaluation-Report-2023.pdf
Size
3 MB
Format
application/pdf
Descargar

GAFILAT - Portuguese - Mutual Evaluation of Brazil 2023

Filename
Brasil-RELATÓRIO-DE-AVALIAÇÃO-MÚTUA-2023.pdf
Size
3 MB
Format
application/pdf
Baixar

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