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  • BDO's AML Watch - August 7th, 2023

BDO's AML Watch

07 August 2023

Richard Carty, Director, RAS |

Caribbean AML/FCP

FATF Threatens Jamaica and Barbados

  • The global Financial Action Task Force (FATF) has threatened to call "on its members and urging all jurisdictions to apply enhanced due diligence to business relations and transactions with Jamaica". In a statement on it's website, the global financial regulatory body expressed concern as the Caribbean nation "failed to complete its action plan, which fully expired in January 2022". The FATF has also warned Barbados that it "will consider next steps if there is insufficient progress" on its action plan, which expired in April 2022.


Red Flags Among Golden Passports: An Analysis of Chinese Influence In Five Caribbean Citizenship By Investment Programs

  • Citizenship By Investment has become an enormous source of revenue for Antigua and Barbuda, Dominica, Grenada, St. Lucia, and St. Kitts and Nevis, contributing nearly 30 percent of GDP in St. Kitts and Nevis and Dominica. For several Caribbean countries like St. Lucia, CBI boosts the country’s development in a variety of sectors, including hospitality, goods and services, infrastructure, banking, broadcasting, and youth development projects. But there’s also a dark side to CBI. Researchers, journalists, and government officials have documented how CBI could be used for corruption. The growing influence of wealthy overseas Chinese individuals in CBI programs may undermine CBI countries’ sovereignty, prosperity, and security.


Global AML/FCP

UK Regulator Warns Fintechs to Improve AML, Sanctions Controls

  • The U.K. Financial Conduct Authority warned that payment services providers and electronic money institutions are “under-reporting” transactions indicative of money laundering as well as potential sanctions breaches because of weak compliance controls. These failures, combined with the outsourcing of transaction-monitoring systems to third parties located abroad “without sufficient oversight” and “poor” calibration of automated transaction-monitoring controls and a failure to investigate alerts, were exposing many institutions to abuse by financial criminals, according to the regulator.

US Treasury Taps OFAC’s Gacki for Top FinCEN Post

  • Andrea Gacki, director of the U.S. Treasury’s Office of Foreign Assets Control, will become the new head of the Financial Crimes Enforcement Network (FinCEN), replacing acting director Himamauli Das. FinCEN has been led by acting directors for more than two years, sparking criticism that the financial intelligence unit’s leadership lacked the backing and continuity of a permanent director. Gacki will be replaced by her deputy Bradley Smith. In addition to leading OFAC, where she implemented and enforced U.S. economic sanctions, Gacki also previously served as Treasury’s Under Secretary for Terrorism and Financial Intelligence.


Germany to Set Up New Body to Combat Money Laundering
  • Germany will set up a new body, the Federal Bureau of Financial Intelligence, under planned legislation to combat money laundering. The new office, to be set up next year, will centralize monitoring and analysis of money laundering and sanctions enforcement. A finance ministry spokesperson said the target is to have 1,700 employees with offices in Dresden and Cologne. Currently, two separate bodies are responsible for monitoring potential money laundering and meting out sanctions, the Central Office for Sanctions Enforcement and the Central Office for Financial Transaction Investigations.


Industry Updates


Using the Right Tech Tools to Protect Against Money Laundering

  • Many businesses don’t realize that they’re required to comply with anti-money-laundering (AML) policies and end up suffering significant fines as a result. Proactive compliance with AML regulations is crucial, especially during a time of increased regulatory scrutiny. Although part of the lack of compliance may be due to negligence, the fact that anti-money-laundering systems are hard to implement also plays a key role. During a time of increasingly bold regulations, AI-infused tech solutions are helping many companies meet AML obligations.