Saturday, May 2, 2015


As you know, the Financial Action Task Force placed the Republic of Panama on what is commonly known as its "Grey List," regarding its adherence to its international AML/CFT standards. The FATF is scheduled to meet again this October, and to render its opinion on Panama in 2016.

Panama, which is presently passing updated anti-money laundering and counter-terrorism financing legislation, has asked for an additional year, until 2017, reportedly to allow it "to allow the new legislation to prove its efficacy," according to one source. This would be a mistake.

There have been no active money laundering investigations in Panama, which has had  anti-money laundering legislation for fifteen years, for a long time. It is foolish to believe that those banks in Panama that engage in systemic money laundering will report suspicious transactions, cooperate with Panamanian regulators, and work to drive money launderers out of Panama. This is merely a delaying tactic. Furthermore the new, stricter laws will not be enforced against the firmly entrenched organized crime structure, which owns some of the banks, and there will therefore be no evidence of such actions to give the FATF.

Many observers believe that the one-year delay, which was reportedly requested by local banks, will only allow existing money laundering banks to move an additional $5bn through the global banking system. No purpose will be served by additional delays in placing Panama firmly upon the "Black List" of totally uncooperative jurisdictions, which is where it has a good chance of going. At that point, even dirty money will begin to flee for safer harbors.

The true reason for the delay is said to be requested to give the  banks additional time to haul in obscene profits, before the "flight capital" moves on. Therefore, it is suggested that FATF stick to its original schedule, and rule on Panama in 2016.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.