The Financial Intelligence Analysis Unit (“FIAU”) is informing subject persons that the Council of Europe’s anti-money laundering and counter-terrorist financing monitoring body, MONEYVAL, has published a typologies report examining risks and trends associated with conflict-related money laundering and proceeds generated in conflict-affected regions.
The report provides an analysis of how illicit proceeds arising from armed conflicts are generated, transferred, concealed and ultimately integrated into the financial system. In particular, it explores how conflict-related money laundering may facilitate terrorist financing and proliferation financing, while identifying structural vulnerabilities and emerging typologies that may support competent authorities and subject persons in strengthening preventive measures.
Conflict-affected regions are frequently characterised by weakened governance, disrupted markets and diminished regulatory oversight. These conditions may create environments in which conflict-related money laundering risks increase, allowing illicit proceeds derived from activities such as trafficking, corruption and the exploitation of natural resources to be channelled into the global financial system. The report notes that such proceeds may be reinvested in ways that sustain instability and undermine economic resilience.
The report also explains how criminal networks use increasingly sophisticated techniques to conceal the origin and movement of funds linked to conflict-related money laundering. These include complex corporate structures that obscure beneficial ownership, the use of intermediaries in third-country jurisdictions, and the growing reliance on virtual assets and alternative payment channels to enable cross-border transfers.
For subject persons operating within Malta’s anti-money laundering and counter-terrorist financing framework, the findings reinforce the importance of maintaining a robust and dynamic risk-based approach. Particular attention should be given to business relationships and transactions that may be exposed to conflict-related money laundering risks, especially where complex ownership structures or unusual cross-border activity are present. Where higher risk is identified, enhanced due diligence, ongoing monitoring and appropriate escalation measures are expected in line with regulatory requirements.
The report further highlights the importance of international cooperation in addressing the transnational nature of conflict-related money laundering and associated financial crime risks. Effective information sharing between supervisory authorities, financial institutions and law enforcement agencies remains essential to identifying and disrupting illicit financial flows.
Overall, the MONEYVAL typologies report provides insight into the evolving nature of conflict-related money laundering and its broader implications for financial integrity and global stability. Subject persons are encouraged to familiarise themselves with the report’s findings and ensure that their internal controls and risk management frameworks remain proportionate, effective and aligned with evolving regulatory expectations.
