US: Report names several Caribbean nations as “major money laundering” centres.

As published on caribbeannewsnow.com, Thursday 11th April, 2019.


In the latest US International Narcotics Control Strategy Report (INCSR), volume two dedicated to money laundering, the report lists all major Caribbean and Central American countries as “Major Money Laundering Jurisdictions” for the year 2018: Antigua and Barbuda, Aruba, The Bahamas, Barbados, Belize, British Virgin Islands, Cayman Islands, Colombia, Costa Rica, Cuba, Curacao, Dominica, Dominican Republic, El Salvador, Guatemala, Guyana, Haiti, Honduras, Jamaica, Mexico, Nicaragua, Panama, St Kitts and Nevis, Saint Lucia, St Vincent and the Grenadines, St Maarten, Suriname, Trinidad and Tobago and Venezuela.

In fact, the only Caribbean/Central American countries left off of this year’s INCSR are the US Virgin Islands and Puerto Rico, both US protectorates, along with Martinique, Guadeloupe and French Guiana, all three of them overseas departments of France.

The US even added itself to the list of major money laundering jurisdictions along with the United Kingdom, Spain and The Netherlands all founding members of the Organization for Economic Co-operation and Development (OECD), with the OECD working closely in conjunction with the European Union (EU) on tax-avoidance issues and creating the “Tax Haven Blacklist” that seeks to name and shame and then penalize countries that it has found to be tax havens and money laundering centres.

The US is a founding member of the Financial Action Task Force (FATF), the international financial crimes watch dog that also works in conjunction with the OECD on tax avoidance and tax fraud related matters.

The INCSR also stated in its report that: ”the development and implementation of effective Anti-Money Laundering (AML) regimes consistent with international standards and the ability to meet evolving challenges is clearly vital to the maintenance of solvent, secure, and reliable financial, commercial, and trade systems,” and went further to state that this law enforcement’s objective is consistent with the US’s “2018 national security strategy and the 2017 executive order 13773, enforcing federal law with respect to transnational criminal organizations and preventing international trafficking.”

The report also indicates the work of its parent US governmental department, the US State Department, through the Bureau of International Narcotics and Law Enforcement Affairs (BINALA) and the work they have done in regard to bi-lateral and multi-lateral cooperative efforts to strengthen criminal justice systems and law enforcement agencies around the world. Through the BINALA various international programs, as well as in coordination with other DOS bureaus, US government agencies, and multilateral organizations, the INL addresses a broad range of law enforcement and criminal justice areas.

For example, the INSCR report highlighted initiatives undertaken in the Eastern Caribbean with St Vincent and the Grenadines when the high court granted a recovery order forfeiting approximately US$33,000 (EC$100,000) in a fraud and money laundering case. The recovery order is the first granted in the Eastern Caribbean under the proceeds of crime act (POCA) and sets the stage for further civil recovery actions against assets belonging to serious organized criminals. This order is said to be the culmination of more than six years of INL-assisted reform, technical assistance, and training efforts in the Eastern Caribbean led by INL’s Caribbean financial crimes advisor.

The report states that the “INL assisted in the drafting and passage of the POCA; helped establish a Civil Asset Recovery Division (CARD) within the St Vincent and the Grenadines FIU; provided training for investigators, attorneys, and the judiciary; and mentored the CARD throughout this case. As mandated by the POCA, the government will use recovered funds to support criminal justice agencies in St Vincent and the Grenadines.”

The INCSR report does not indicate if whether or not US sanctions or additional pressure will come as a result of being put on the major money laundering centres list, unlike the EU’s money laundering and tax haven blacklist, the INCSR list is primarily short note on to further guidance on AML regimes around the world as the report went on the flesh out the rationale behind every country on the list.

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