AMERICAN BANKS START REJECTING CBI PAYMENTS FOR DOMINICA, SETTING OFF FEARS OF THE LOSS OF CORRESPONDENT ACCOUNT RELATIONSHIPS, WHICH COULD CRIPPLE CARIBBEAN ECONOMIES

The economic situation in the Commonwealth of Dominica is dire, after Bank of America, which maintains the primary correspondent relationship with the country's principal financial institution, reportedly rejected transactions that involved payments in the country's Citizenship by Investment (CBI/CIP) economic citizenship passport sales program. Government application fees, and associated payments to local contractors building CBI-funded projects, are deemed essential to economic survival of the island nation, and to the funding of its government. Hurricanes and tropical storms in recent years have had a major impact upon Dominica, which has become dependent upon CBI to survive. Bankers and government officials in Dominica now openly fear for their nation's fiscal survival.

The problems currently facing American banks maintaining correspondent accounts with East Caribbean states that offer CBI products are serious:

PM Roosevelt Skerrit

(1) Passport sales vendors abroad have been discounting the official minimum prices of economic citizenships of a number of EC countries, including Dominica, which is a violation of the laws that created these programs, exposing the US banks that accept and forward payments of what are illegal transactions, through their correspondent accounts to civil, administrative and even criminal penalties under American law.

(2) Due diligence that is required to be performed upon the Source of Funds and Source of Wealth of many foreign applicants from high-risk countries has been far below the standard of Banking best Practices, further endangering US that accept what could later be determined to be the Proceeds of Crime to money laundering charges.

(3) Should the rejection of CBI payments by American banks spread to St. Kitts and St. Lucia, which presently have their own problems with the illicit sale of CBI passports, and which are under fire due to a pending RICO lawsuit in the United States, their economies could also what amounts to a fatal blow, as they also are heavily dependent upon CBI revenue, aa well as necessary ties to the American financial structure.

Coat of Arms of Dominica

If American banks, to protect themselves, sever account relationships with banks in Dominica, St. Kitts and St. Lucia, the economic outlook for those counties would be extremely bleak especially where essential imports and international trade is involved. Denials by government leaders, themselves implicated in CBI-related corruption, is not solving this existential problem. Whether the economies of these tiny nations can survive this crisis has become the paramount issue in the region. Is there a solution?