Across Borders ¦ Belgium's Measures to Counter Money Laun­der­ing, Terrorist Financing and Pro­lif­er­a­tion Financing

Belgium’s AML/CFT System at a Crossroads: Progress on Paper, Gaps in Practice

Belgium’s evolving anti-money laundering and counter-terrorist financing framework has achieved important legislative and institutional updates since the 2015 evaluation, yet the Financial Action Task Force (FATF) mutual evaluation of early 2025 shows that effectiveness lags behind technical compliance. This discrepancy threatens Belgium’s ability to dismantle organised crime networks, seize illicit assets at scale, and keep pace with rapidly developing threats such as virtual assets. The country has solid building blocks – a capable Financial Intelligence Unit (CTIF), expanded reporting requirements, a beneficial ownership register and recent regulatory reforms – but chronic under-resourcing, uneven supervision of high-risk sectors, gaps in asset recovery, and incomplete frameworks for virtual assets and non-profit organisation risk management hinder practical results.

A system strengthened in law but stretched in implementation

Since 2015, Belgium has modernised much of its AML/CFT architecture to align with FATF standards and EU instruments. Key measures include the 2017 AML law transposing EU AML Directives, the 2018 UBO register, improved freezing tools for counter-terrorism financing, and expanded reporting obligations for multiple sectors. These measures have improved legal compliance: several FATF Recommendations that were only partially met in the prior evaluation are now largely or fully met in technical terms.

However, the country’s operational performance remains mixed. The FATF rates Belgium’s effectiveness across 11 Immediate Outcomes largely as Moderate, with only a few Substantial or higher. Core weaknesses are practical rather than legal:

• judicial and police units lack sufficient human and technological resources to conduct systematic, in-depth financial investigations;
• supervisory authorities underuse administrative sanctions and publish few decisions; and
• strategic targeting of the highest-risk criminal phenomena is not yet embedded across agencies.

Virtual assets: a rapidly rising threat without a full supervisory response

FATF highlights a confirmed and growing risk of virtual assets and virtual asset service providers (VASPs) being exploited for money laundering and terrorist financing. Belgian authorities have improved understanding of these risks but lack deep expertise and dedicated tools. Critically, following EU MiCA entering into force on 31 December 2024, Belgium had not yet designated a domestic licensing and supervisory authority for VASPs at the time of the evaluation, leaving the sector without formal oversight. The FATF recommends immediate designation, strengthened expertise, and a strategic national approach to VA risks, including cooperation with the private sector and tailored supervisory tools.

Resource shortfalls undermine law enforcement and asset recovery

A recurrent finding is that police and prosecutorial resources are insufficient relative to the scale and complexity of ML and predicate crime in Belgium. This shortfall pre-dates the current evaluation and continues to reduce the country’s capacity to prioritise and pursue organised crime networks, undertake complex financial investigations, and achieve meaningful confiscation outcomes. Belgium’s legal framework enables confiscation and provides tools to pursue asset recovery, but practical enforcement is limited: confiscation and seizure are not used systematically, enforcement of confiscation orders faces significant obstacles, and recovery rates are low. The FATF calls for targeted allocation of human and technological resources to investigative and prosecutorial bodies and the Central Office for Seizures and Confiscations.

Bastian Schwind-Wagner _Follow

"Belgium has strengthened its AML/CFT legal framework and key institutions, but gaps in resourcing and supervision limit practical results. Converting technical compliance into sustained operational impact requires targeted investment in investigative capacity, supervision and verification of ownership data.

Urgent priorities include designating and resourcing a supervisor for virtual assets, beefing up police and prosecutorial tools for complex financial investigations, and reinforcing sanctions and publication practices to increase deterrence. A focused, risk‑based national strategy tying resources to the most harmful crime patterns will be essential to reduce money laundering and terrorist financing effectively."

Risk understanding is solid but not always translated into strategic, resourced action

Belgium produces and updates national and sectoral risk assessments and has a satisfactory understanding of core threats: cash and drug trafficking, fraud (tax and social), organised crime, professional money launderers, and increasing misuse of legal persons and arrangements. The national analyses also identify TF risks largely linked to returning foreign terrorist fighters and micro-financing. Nevertheless, the authorities have not yet translated these assessments into a comprehensive, strategic AML/CFT plan with clear priorities, resourcing, and measurable objectives focused on the most harmful criminal patterns, including underground financial channels and VAs. The 2024 AML Action Plan is a step forward but falls short of a long-term, strategic orientation that aligns prosecutorial policy, investigations, supervision, and asset recovery resources to the identified risks.

Beneficial ownership transparency improved, verification remains weak

The introduction of a beneficial ownership (UBO) register in 2018 and high registration rates (around 98%) are important advances. Belgium’s multi-source approach to ownership information – combining the UBO register with the Banque-Carrefour des Entreprises (BCE) and reporting-entity information – provides a strong foundation. Yet the registers contain inaccuracies and outdated entries because verification measures are insufficient. The 2019 corporate code reform simplified company formation and has unintentionally increased the number of shelf and dormant entities, heightening the risk of shell structures. FATF stresses the need for rigorous, risk-based verification, accelerated clean-up of inactive entities, prioritisation of reporting-entity discrepancy notifications, and measures to detect nominee directors/shareholders and straw-men arrangements.

Supervision of financial and non-financial sectors: uneven coverage and weak deterrence

The National Bank of Belgium (BNB) and the Financial Services and Markets Authority (FSMA) conduct risk-based supervision of many financial institutions and carry out detailed on-site inspections. However, supervisory coverage is uneven: certain payment and electronic-money institutions receive fewer on-site checks; supervisory follow-ups can be delayed; and administrative sanctions are seldom used and often anonymous, defeating deterrence and transparency. For designated non-financial businesses and professions (DNFBPs), supervision is fragmented and under-resourced. SPF Economy, responsible for several high-risk sectors (estate agents, business centres, diamond dealers), carries out too few inspections despite high non-compliance rates. The diamond sector is singled out as particularly high risk and under-supervised. FATF recommends increasing inspection frequency in high-risk sectors, strengthening sanction regimes and their publication, pooling expertise, and ensuring sanctions are proportionate and dissuasive.

Financial intelligence system is effective but technology and follow-through lag

CTIF (Belgium’s FIU) is central to the country’s financial intelligence and produces operational and strategic products supporting investigations and prosecutions. CTIF receives large volumes of STRs and has wide access to administrative and financial databases. Nonetheless, CTIF’s IT tools were inadequate for the growing complexity and volume of data; deployment of the goAML platform in October 2024 should help, but further enhancements and resources are needed. More fundamentally, judicial authorities underuse financial intelligence, and customs and tax intelligence – both highly relevant given Belgium’s cash-trafficking and fraud threats – are not consistently exploited in ML investigations. FATF recommends expanding CTIF’s analytical reach and ensuring law enforcement has the capacity and processes to integrate financial intelligence into proactive, complex investigations.

Terrorist financing framework generally solid but needs to adapt to new channels

Belgium’s counter-terrorism and TF framework improved substantially after the 2015/2016 attacks and now benefits from integrated operational structures (Joint Intelligence Centres (JICs) and Joint Decision Centres (JDCs)) and a focused prosecutorial capacity. TF investigations and prosecutions are generally effective, and sanctions appear to be meaningful. Yet Belgium’s ability to rapidly adapt to new TF financing methods – informal channels and virtual assets – remains limited. The approach to non-profit organisations (NPOs) also needs refinement: the risk assessment of the sector does not yet identify exhaustively which entities are most vulnerable, and monitoring/mitigation tools are not sufficiently targeted or proportionate. FATF advises removing the requirement that designation under national TF freezing depends on existence of police or judicial investigations, enhancing NPO-targeted measures, and strengthening inter-agency coordination for the sector.

Proliferation financing measures in early stages

Belgium’s proliferation financing (PF) measures are mainly implemented through EU and UN instruments, with initial steps taken to understand PF risk via a first national PF risk analysis in 2023. However, that analysis did not sufficiently address circumvention risks, typologies or sectors vulnerable to DPRK-linked evasion. Reporting entities and supervisors have limited experience in detecting sophisticated PF circumvention. FATF recommends deepening PF risk analysis, developing PF-specific risk indicators, and conducting targeted inspections with appropriate sanctions for non-compliance.

International cooperation: constructive but under-measured and uneven

Belgium relies heavily on international cooperation given its geographic and commercial profile, and several case examples demonstrate successful mutual legal assistance and joint investigations. Informal networks are actively used and valued by partners. Nevertheless, Belgium lacks comprehensive statistics and mapping of international cooperation activities and outcomes, especially at district prosecutor levels. This gap makes it difficult to assess alignment of cooperation with national risks or to institutionalise best practices. FATF calls for accelerated diplomatic and judicial cooperation, systematic data collection on mutual legal assistance, and more resources for prosecutors to follow transnational leads.

Priority actions the FATF recommends Belgium take now

FATF identifies a set of Key Recommended Actions (KRAs) that Belgium should prioritise. They include:

• promptly designating authority and supervisory framework for VASPs under MiCA;
• significantly increasing human and technical resources for police and prosecutors focused on financial investigations and asset recovery;
• adopting a strategic AML/CFT plan aligned to national risk priorities (including a focus on cash flows, underground finance, VAs, and professional launderers);
• strengthening verification and remediation of UBO and company registers;
• bolstering supervisory coverage and the use and publication of effective administrative sanctions for both financial and non-financial sectors;
• enhancing CTIF technology and the use of financial intelligence by investigators;
• improving NPO risk-targeting and mitigation;
• deepening PF risk analysis and supervisory action; and
• collecting comprehensive international cooperation statistics while expanding bilateral cooperation in priority jurisdictions.

Implications for practitioners and policy-makers

For compliance officers, investigators, prosecutors, and supervisors operating in Belgium or across borders with Belgian entities, the report signals that regulatory frameworks are largely compliant but enforcement intensity varies. Entities should expect increased scrutiny in areas where risks are clear – cross-border cash movements, diamond trade channels, certain real-estate and corporate services, and virtual asset flows – and should prepare for deeper requests for beneficial ownership verification and transaction scrutiny. For policy-makers, the report is a clear call to match legal reforms with sustained investment in specialised investigative and analytical capacity, stronger and transparent sanctions, clearer oversight for virtual assets, and a strategic national focus that concentrates scarce resources on the most harmful criminal patterns.

Conclusion

Belgium has modernised its AML/CFT legal framework and created institutional tools that, in time and with appropriate resources, could yield strong results. The central challenge identified by FATF is implementation: without …

• substantive increases in investigative, prosecutorial and supervisory capacity;
• clearer oversight of virtual assets;
• rigorous verification of ownership data; and
• a strategic, risk-prioritised approach to action,

… the country will struggle to convert legal alignment into tangible reductions of money laundering, terrorist financing and proliferation financing.

The next phase for Belgium must be to resource and operationalise its reforms so that laws and registers do not remain primarily formal instruments but become effective levers against serious, organised and evolving financial crime.

Dive deeper

• FATF ¦ Belgium’s measures to counter money laundering, terrorist financing and proliferation financing ¦ Link