The APG report draws attention to the absence of an adequate legal framework or guidelines for implementing United Nations Security Council Resolutions 1267 and 1373, which are crucial for countering terrorist financing. The lack of these frameworks continues to hinder the Maldives’ ability to take necessary measures to combat terrorism-related financial crimes.
Maldives Monetary Authority (MMA)
A recent report issued by the Asia/Pacific Group on Money Laundering (APG) has warned that the Maldives is facing significant risks related to money laundering, corruption, embezzlement, fraud and terrorist financing.
The report sheds light on the high likelihood of such crimes due to pervasive bribery and corruption across government institutions and state-owned enterprises in the country.
A key concern highlighted in the APG’s "Anti-Money Laundering and Counter-Terrorist Financing - Maldives Report" released in October 2025 is the increase in suspicious financial transactions in the Maldives, as outlined in the 2023 Annual Report by the Financial Intelligence Unit (FIU). These transactions suggest the involvement of politically exposed persons (PEPs), their families and others in criminal activities such as bribery, abuse of power, and misuse of funds.
The report also flags concerns over corruption linked to various state-run projects.
Due to its strategic location, Maldives is at an elevated risk of being used as a transit point for illicit financial transactions, drug trafficking and human trafficking.
APG’s report also identifies a very high risk of terrorist financing in the country. Factors contributing to this vulnerability include a reliance on cash-based transactions, porous borders, weaknesses in the reporting of suspicious financial activities and a limited capacity within law enforcement to combat such crimes.
Maldives has been flagged previously for being one of the countries sending the highest number of foreign fighters relative to its population to conflict zones such as Syria and Iraq. In 2021, approximately 173 Maldivians traveled to conflict areas, with 432 individuals intercepted or repatriated.
Media reports have indicated that Maldivians have supported ISIS networks and acted as intermediaries in financing terrorist activities in Pakistan. These concerns add to the mounting risks of terrorist financing.
Although the Maldives conducted a risk assessment on money laundering and terrorist financing in 2022, the report has not been made publicly available. APG further points out that no official updates have been issued since the assessment.
The report also stresses that the extent of terrorist financing risk in the Maldives is poorly understood, with limited information available on the financing of terrorism and related activities. The lack of awareness among relevant authorities regarding this risk is also noted as a critical gap.
The report reveals that the Maldives lacks a national strategy to combat money laundering and terrorist financing, and there is no established system for the regular review of national policies. The coordination between the agencies involved in countering these issues remains weak, and efforts are not consistently carried out.
APG’s findings also indicate that while there is a formal structure for the National Coordination Committee, the absence of a national strategy and Standard Operating Procedures (SOPs) for tackling money laundering and terrorist financing at the national level undermines the effectiveness of these efforts.
Despite the high risks of illicit financial activities in the Maldives, the report highlights the absence of a comprehensive framework for policy development or operational cooperation on these critical issues. The report also notes that while various agencies use financial intelligence in investigations, the FIU, which plays a primary role in financial oversight, has limited access to key government databases.
Access to information such as criminal records, tax records and property registration is restricted and can only be obtained upon request. Further, there is no standardized process or timeline for accessing this information, creating further barriers to effective investigation and enforcement.
The FIU has produced only one strategic report related to business-related money laundering, which has not been made publicly available. In addition to this, the report questions the outcomes of investigations conducted by the FIU into money laundering and terrorist financing cases, indicating that the unit’s financial intelligence capabilities are underdeveloped and insufficient to support successful prosecutions or asset recovery.
While the Maldives Police Service (MPS) is identified as the primary agency responsible for investigating and prosecuting money laundering cases, the report states that operational activities in high-risk money laundering sectors have not been conducted. The absence of a robust national strategic policy on money laundering further complicates efforts in this area. Further, financial analysts working in investigative agencies are largely self-trained, and there is no evidence to suggest that the country has investigated any significant money laundering cases.
The report also points out that a sufficient legal framework for seizing the proceeds of crime is not fully in place and is not effectively enforced. The Maldives' approach to combating terrorist financing is equally inadequate, with the report noting that these issues have not been integrated into national counter-terrorism strategies. Despite the clear risks, no convictions have been made in terrorist financing cases, and the limited number of investigations conducted is a cause for concern given the scale of the threat.
Although the National Counter Terrorism Centre is the designated lead agency for national counter-terrorism efforts, the report suggests that it has not made effective progress in addressing terrorist financing. The report goes on to highlight that no one has been convicted for terrorist financing offenses to date, making it difficult to assess the effectiveness of penalties or limitations in these cases.
Finally, the APG report draws attention to the absence of an adequate legal framework or guidelines for implementing United Nations Security Council Resolutions 1267 and 1373, which are crucial for countering terrorist financing. The lack of these frameworks continues to hinder the Maldives’ ability to take necessary measures to combat terrorism-related financial crimes.
