Moneyval Publishes Report on Money Laundering Risks in Cyprus

The Council of Europe’s Moneyval anti-money laundering body has issued a report on money laundering risks in Cyprus. Moneyval identified a relatively new risk in Cyprus with the expansion of Melco’s operation, which opened its first casino in Limassol in 2018.

The report appeared to be suggesting that Cyprus consider not permitting the casino to expand until it can “responsibly manage” the risk associated with its current configuration. The Limassol integrated casino and resort is due to open at the end of 2021.

“The enlargement… will undoubtedly increase the ML (money laundering) and TF (terrorist financing) risks and require a number of further mitigation measures. For this reason, the casino was weighted fourth in terms of materiality,” Moneyval said.

“The casino is currently operating at or beyond the limits of its ML/TF compliance and risk management system. Cyprus should consider whether the casino can responsibly manage the ML/TF risk associated with its current configuration, and if not then whether the current configuration should be changed in ways that provide more certainty about effectiveness, such as to a membership model. In any event, until the casino can demonstrate an effective… programme at its current level of activity, Cyprus should consider not permitting it to expand that activity,” it added.

The Moneyval report said an action plan prepared by an outside consultant, which is nearing completion, would identify mitigating steps that are needed to address current deficiencies, “but it is unclear whether the plan is intended to identify steps that will need to be taken to accommodate anticipated growth,” it added.