IMF launch Regional Nordic-Baltic Technical Assistance Report on “Financial Flows Analysis, AML/CFT Supervision, and Financial Stability”

In a first-of-its-kind technical assistance project on Anti-Money Laundering, Sweden partnered with the IMF and Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, and Norway to continue enhancing the effectiveness of the AML/CFT frameworks at country and regional levels. The IMF used machine learning technology, on a country specific and regional level, to better understand cross-border money laundering risks, analysed the sensitivity of AML/CFT supervisory tools in responding to these risks and developed recommendations to increase their effectiveness, and explored quantifying the impact of money laundering shocks on financial stability [link to regional report].

The Report notes that continuous efforts to strengthen AML/CFT frameworks are a clear priority in the Region and that coordinated action and innovative solutions are key in keeping pace with evolving financial integrity risks. More specifically, it recommends the ongoing monitoring of cross-border flows, with regional information exchange on macro-trends, and better identification of countries with potential money laundering risks to the Nordic Baltic Region. To bolster AML/CFT risk-based supervision, the Report calls for increased collection of cross-border data and complementary investments in advanced data analytic tools, as well as coordinated supervisory action for the highest risk banks. Finally, it recommends continued analysis of the impact of financial integrity breaches on financial stability to fortify the financial system against money laundering shocks.

Sveriges Riksbank welcomes the analysis and outcome of the project and hopes that through publication of this report, the private sector and other countries can take key learnings from the experiences and good practices of the region.