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This study aims to consider the anti-money laundering/combating of financing of terrorism (AML/CFT) regime that applies to microfinance institutions (MFIs) and microfinance programmes and projects (MFPs) in Vietnam to identify ways in which to improve the alignment between financial inclusion and financial integrity objectives in relation to this sector.

This doctrinal study is informed by the Financial Action Task Force mutual evaluation methodology.

The AML/CFT regulatory framework for MFIs/MFPs is inadequate but improving. The money laundering and terrorist financing risks posed by microfinance are low and so is the capacity of many providers to comply with AML/CFT obligations. Given the low risk, there is space to simplify AML/CFT requirements for this sector in a manner that will better align financial inclusion and financial integrity policy objectives.

This paper considers the implementation of AML/CFT obligations of MFIs/MFPs based on existing studies as well as own research relating to compliance and supervisory practices. Further empirical studies to determine for the whole microfinance sector could provide a more granular understanding of crime risks and compliance capacities in the sector.

AML/CFT regulators in Vietnam can take concrete steps to simplify the AML/CFT due diligence obligations of MFIs/MFPs and support these institutions to formalise and implement appropriate AML/CFT measures.

MFIs/MFPs play a vital socio-economic role by providing financial services to the poor. Appropriate AML/CFT control measures can enable these providers to continue providing these services while strengthening economic formalisation and integrity goals of the government.

The paper provides novel supervisory perspectives on the AML/CFT regime in relation to MFIs/MFPs.

This paper aims to investigate the purpose, reach and effectiveness of the customer identification framework of the Financial Action Task Force (FATF).

The article draws on relevant research and documents of the FATF, the Basel Committee on Banking Supervision and the Alliance for Financial Inclusion to determine whether compliance with the standards and practices of the FATF would prevent anonymous usage of financial services.

The FATF’s identification principles, guidance and practices resulted in processes that are largely bureaucratic and do not ensure that identity fraud is effectively prevented. Strict identification requirements on the other hand may impact on financial inclusion, leaving the FATF with little leeway to raise its standards. There are potential solutions, but they are longer-term and partial in nature.

Current identification and verification practices affect the lives of millions of people around the globe. The measures are being enforced to ensure that users are appropriately identified. This article informs the debate by highlighting the weaknesses of the current approach.

The purpose of this paper is to identify key questions that should be addressed to enable the Financial Action Task Force (FATF) to provide guidance regarding the alignment of anti‐money laundering, combating of financing of terror and financial inclusion objectives.

The paper draws on relevant research and documents of the FATF to identify questions that are relevant to consider when it formulates guidance regarding the alignment between financial integrity and financial inclusion objectives.

The FATF advises that its risk‐based approach enables countries and institutions to further financial inclusion. It is, however, not clear what the FATF means when its uses the terms “risk” and “low risk”. It is also unclear whether current proposals for financial inclusion regulatory models will necessarily limit money laundering as well as terror financing risks to levels that can be described as “low”. The FATF will need to clarify its own thinking regarding low money laundering and low terror financing risk before it will be able to provide clear guidance to national regulators and financial institutions.

This paper was drafted to inform current FATF discussions regarding guidance on financial inclusion. The questions are relevant to all stakeholders in financial regulation.

The purpose of this paper is to investigate Financial Action Task Force (FATF)'s risk‐based guidance to combat money laundering and terrorist financing to determine its approach to the identification and management of low‐risk providers, products and transactions.

The paper analyses the relevant FATF recommendations and its guidance notes and reflects on key questions for regulators and financial institutions.

FATF has not defined “risk” for purposes of the risk‐based approach. The absence of a clear definition complicates the identification of low‐risk products. FATF do provide an example of a risk matrix that can be used to identify low‐risk banks, but the example is based on assumptions and generalisations that are not sustainable. In addition, it identifies certain low‐value transactions as “low risk” transactions. The paper reflects on the role of value as an indicator of risk and concludes with a number of suggestions to clarify the conceptual framework.

Low‐risk products and transactions are often overlooked because the risk‐based approach focuses attention on high‐risk matters. Low‐risk products are however crucial to the efforts to increase financial inclusion. The paper identifies gaps in the current conceptual framework and indicates ways in which they can be addressed.

The purpose of this paper is to analyze the Vietnamese laws and practices concerning the confiscation of proceeds of crime, especially in view of Vietnam’s obligations to meet the international standards on money laundering and terrorist financing, set by the Financial Action Task Force and relevant international conventions that Vietnam ratified. To limit the scope of this paper, the analysis focuses on the confiscation of proceeds of domestic crimes that do not require international legal assistance. This paper concludes with recommendations for improving the legal framework on criminal asset recovery in Vietnam.

This is a doctrinal study that considers the applicable legal framework. This study is supported by brief case studies of major cases involving the confiscation of proceeds of crime.

Vietnam has a functioning asset confiscation regime but gaps in the law, lack of financial investigation expertise and lack of focused investigative attention on asset preservation and confiscation are hampering its effectiveness. The key gaps can easily be closed with appropriate amendments to the law. These reforms should be combined with a dedicated skills development program to produce sufficient number of financial investigation experts and criminal asset management experts to support the regime. The training should extend to judicial officers to ensure an appropriate understanding of the asset confiscation law. Reforms such as these should follow on a comprehensive review of Vietnam’s law and practices relating to the confiscation and forfeiture of criminal assets. This review should extend to assets linked to the financing of terrorism and proliferation to ensure that Vietnam has a comprehensive regime to deal with criminal assets.

This paper draws on publicly available information regarding the confiscation of proceeds of crime in Vietnam. Little data is available on asset confiscation and that prevents an in-depth assessment of the regime.

This paper highlights gaps in the current asset confiscation regime and proposes reforms and approaches that will ensure a more effective asset confiscation regime for Vietnam.