Bank Fees To Send Money From St Maarten

All money laundering and financial crimes countries/jurisdictions.

Malaysia

Malaysia is a growing regional financial center and has a
well-developed anti-money laundering/counter-terrorist financing
(AML/CFT) framework. Malaysia’s long
porous
 /por·ous/ () penetrated by pores and open spaces.


adj.
1. Full of or having pores.

2. Admitting the passage of gas or liquid through pores.
 land and sea borders
and its strategic geographic position increase its vulnerability to
transnational criminal activity, including
money laundering

 and

terrorist financing

. Malaysia is primarily used as a transit country to
transfer drugs originating from the Golden Triangle and Europe; and
Iranian and Nigerian drug trafficking organizations are the main sources
of illegal proceeds in Malaysia. Drug trafficking is the main source of
illegal proceeds in Malaysia.

Malaysian authorities also highlight illegal proceeds from
corruption as a significant money laundering risk. Other common

predicate

 offenses generating significant proceeds in Malaysia include
fraud, criminal breach of trust, illegal gambling,
credit card fraud

,
counterfeiting, robbery,
forgery
 in art, the false claim to authenticity for a work of art.
The Nature of Forgery

Because the provenance of works of art is seldom clear and because their origin is often judged by means of subtle factors, art
, human trafficking,
extortion
 in law, unlawful demanding or receiving by an officer, in his official capacity, of any property or money not legally due to him. Examples include requesting and accepting fees in excess of those allowed to him by statute or arresting a person and, with
 and

smuggling
 illegal transport across state or national boundaries of goods or persons liable to customs or to prohibition. Smuggling has been carried on in nearly all nations and has occasionally been adopted as an instrument of national policy, as by Great Britain
. Smuggling of goods subject to high tariffs is a major source
of illicit funds. Customs’ efforts to investigate invoice
manipulation identified risks from trade based money laundering.

Free trade zones in Malaysia are divided into Free Industrial Zones
(
FIZ

FIZ National Beverage Corp.  
), where manufacturing and assembly takes place, and Free Commercial
Zones (
FCZ

FCZ Firing Cutout Zone
FCZ Future Control Zone
), generally for warehousing commercial stock. The FIZs are
designed mainly to promote
manufacturing industries
 npl

 npl


 producing goods
mainly for export and are dominated by large international manufacturers
attracted to the zones because they offer preferential tax and tariff
treatment. Currently there are 17 FIZs and 17 FCZs in Malaysia.
Companies wishing to operate in a FIZ or FCZ must be licensed.

Malaysia’s offshore financial center on the island of Labuan
is subject to the same AML/CFT laws as those governing onshore financial
service providers. The financial institutions operating in Labuan are
generally among the largest international banks and insurers. Offshore
companies must be established through a trust company, which is required
by law to establish true beneficial owners and submit suspicious
transaction reports (STRs).

A number of terrorist organizations have been active on Malaysian
territory, and authorities have taken action against Jemaah Islamiah and
other terrorist networks. Terrorist financing in Malaysia is
predominantly carried out using cash and relies on trusted,
clandestine

 networks.

For additional information focusing on terrorist financing, please
refer to the Department of State’s
Country Reports on Terrorism

,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL
NARCOTICS
 n. 1) techinically, drugs which dull the senses. 2) a popular generic term for drugs which cannot be legally possessed, sold, or transported except for medicinal uses for which a physician or dentist’s prescription is required.
 TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION
  
tr.v. crim·i·nal·ized, crim·i·nal·iz·ing, crim·i·nal·iz·es
1. To impose a criminal penalty on or for; outlaw.

2. To treat as a criminal.
 OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: List approach

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (
KYC

) RULES:

Enhanced
due diligence

 procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks in the conventional, Islamic, and
offshore sectors; offshore listing sponsors and trading agents; stock
and futures brokers; unit trust, investment fund, and futures fund
managers; money lenders and pawnbrokers; money remitters; charge account
and credit card issuers; insurance financial advisers; e-money issuers;
leasing and factoring businesses; lawyers, public notaries, accountants,
and company secretaries; licensed casinos and gaming outlets; registered
estate agents; trust companies, and dealers in precious metals and
stones

SUSPICIOUS TRANSACTION REPORTING REQUIREMENTS:

Number of STRs received and time frame: 16,643 in 2010

Number of CTRs received and time frame: Not available

STR

abbr.
synchronous transmitter receiver
 covered entities: Banks in the conventional, Islamic, and
offshore sectors; offshore listing sponsors and trading agents; stock
and futures brokers; wholesale money
changers

; unit trust, investment
fund, and futures fund managers; money lenders and pawnbrokers; money
remitters; charge account and credit card issuers; insurance financial
advisers; e-money issuers; leasing and factoring businesses; lawyers,
public notaries, accountants, and company secretaries; licensed casinos
and gaming outlets; registered estate agents; trust companies, and
dealers in precious metals and stones

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: 100 from 2004 to October, 2011

Convictions: 26 from 2004 to October, 2011

RECORDS EXCHANGE MECHANISM:

With U.S.:
MLAT

MLAT Modern Language Aptitude Test
MLAT Multilateration
MLat Medieval Latin  
: NO Other: YES

With other governments/jurisdictions: YES

Malaysia is a member of the Asia/Pacific Group on Money Laundering
(
APG

APG Assists Per Game
APG Aberdeen Proving Ground
APG Automated Password Generator
APG Asia Pacific Group on Money Laundering
), a Financial Action Task Force (
FATF
 
)-style regional body. Its
most recent mutual evaluation can be found here: http://www.apgml.org/
documents/docs/17/Malaysian%20
MER

%20-%20FINAL%20August%202007.pdf

Reporting institutions are subject to strict customer due diligence
(
CDD

CDD Community Development Department
CDD Cooling Degree Days  
) rules, and the Government of Malaysia (
GOM

) has adopted banker
negligence laws that extend criminal liability to bank directors if
their institution launders money or finances terrorism.

The use of informal remittances, which are not subject to AML/CFT
controls, creates vulnerability for abuse by money launderers and
terrorist financiers. Malaysia’s competent authority for
implementing its AML/CFT laws,
Bank Negara Malaysia

, should continue its
efforts to encourage the use of formal remittances. Additionally, law
enforcement and customs authorities should examine trade based money
laundering and invoice manipulation and their relationship to
underground finance and informal
remittance

 systems. Malaysia should
more aggressively identify, investigate and prosecute drug trafficking
kingpins.

In the past 12 months, Malaysia initiated eight new terror finance
investigations under its AML/CFT legal framework. Malaysia should take
further steps to increase capacity to identify, investigate, and
prosecute terrorist and
proliferation
 /pro·lif·er·a·tion/ () the reproduction or multiplication of similar forms, especially of cells.prolif´erativeprolif´erous


n.
 financing.

Malaysia’s Labuan
Financial Services Authority

 (
LFSA

) is
responsible for ensuring AML/CFT compliance on Labuan, the
country’s international offshore financial center. The Labuan

Financial Services

 and Securities Act of 2010 gives LFSA more
regulatory, investigative and enforcement authorities over offshore
financial services companies licensed in Labuan and removes privacy
restrictions on its access to Labuan-based account activities. In 2011,
the
Inland Revenue

Noun

(in Britain and New Zealand) a government department that collects major direct taxes, such as income tax

Noun 1.
 Board launched a wide-ranging investigation into
money laundering and smuggling activities in Labuan.

In February 2009, LFSA issued an operating license to First East
Export Bank (FEEB), a
wholly owned subsidiary

 of Iran-based
Bank Mellat

,
which in 2007 was designated by the
United States
 officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world’s third largest country in population and the fourth largest country in area.
 under Executive Order
(E.O.) 13382 for its proliferation finance activities. FEEB opened its
Labuan operation in August 2009. The United States designated FEEB under
E.O. 13382 on November 5, 2009, based on its relationship to Bank
Mellat. On June 9, 2010,
UNSCR
 
 1929 listed FEEB as an entity subject to
UN sanctions. The GOM ordered FEEB’s assets frozen and prohibited
Malaysian banks from transacting business with FEEB on July 14, 2010, in
full compliance with UNSCR 1929. LFSA should remain vigilant to any
attempts to use Labuan for proliferation and terrorism finance
activities.

Maldives

Maldives has a small financial market but is susceptible to money
laundering and terrorist financing due to limited oversight capacity. No
official figures are available, but
anecdotal evidence

n information obtained from personal accounts, examples, and observations. Usually not considered scientifically valid but may indicate areas for further investigation and research.
 suggests that
illegal drug trafficking in
psychotropic
 /psy·cho·tro·pic/ () exerting an effect on the mind; capable of modifying mental activity; said especially of drugs.


adj.
 substances and corruption
produce significant amounts of illegal funds. Drug trafficking is noted
as one of the most frequent asset-generating crimes and is estimated to
produce up to $57 million per year. There are indications funds are
raised in the country to finance terrorist activities abroad. Other
predicate offenses include human trafficking,
piracy
 robbery committed or attempted on the high seas. It is distinguished from privateering in that the pirate holds no commission from and receives the protection of no nation but usually attacks vessels of all nations.
, and offenses
committed by gangs. Even though the number of corruption cases is low,
only a small percentage are prosecuted and reports indicate the sums
involved can be significant.

For additional information focusing on terrorist financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: List approach

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: NO Domestic:
NO

KYC covered entities: Banks, security sector licensees

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: None in 2010

Number of CTRs received and time frame: Not applicable

STR covered entities: Banks, security sector licensees

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: None

Convictions: None

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: YES

With other governments/jurisdictions: YES

Maldives is a member of the Asia/Pacific Group on Money Laundering,
a Financial Action Task Force (FATF)-style regional body. Its most
recent mutual evaluation can be found here:
http://www.apgml.org/documents/docs/17/Maldives%20-%20published%20DAR.pdf

ENFORCEMENT AND
IMPLEMENTATION ISSUES

 AND COMMENTS:

Money laundering is criminalized in Maldives only with respect to
proceeds of offenses listed in the Drugs Act. Although all categories of
offenses set out in the international standards have been criminalized,
only drug-related offenses are predicate offenses for money laundering,
constituting a major shortcoming of the current anti-money
laundering/counter-terrorist financing (AML/CFT) framework.

No enforceable AML/CFT obligations are in place. A Banking Act was
put in place in 2010 that requires banks to implement basic AML/CFT
measures such as customer identification and reporting of suspicious
transactions to the financial intelligence unit within the Central
Bank’s
Maldives Monetary Authority

. Beginning in April 2011,
intermediaries in the securities sector are required to implement
limited AML/CFT measures. Oversight efforts are still in the initial
stages.

Shortcomings in the overall criminal legislative framework, in
particular with respect to criminal procedure, and the lack of resources
of competent authorities make it challenging for the Maldives to fight
effectively against money laundering and terrorist financing. Maldives
Police Services, the Prosecutor General’s Office and the judiciary
need capacity building and training to enforce the existing AML/CFT
system.

The Government of the Maldives should become a party to the United
Nations
Convention against Transnational Organized Crime

.

Mali

Mali is not a regional financial center, and presently has no free
trade zones or offshore sectors. Like most
West African

A region of western Africa between the Sahara Desert and the Gulf of Guinea. It was largely controlled by colonial powers until the 20th century.


West African adj. & n.
 countries, Mali
relies on cash for virtually all daily transactions. Illegal proceeds
derive from rampant trafficking of drugs,
small arms
 firearms designed primarily to be carried and fired by one person and, generally, held in the hands, as distinguished from heavy arms, or artillery.
Early Small Arms

The first small arms came into general use at the end of the 14th cent.
, people, and
everyday commodities across the Algerian and Mauritanian borders in the
sparsely-populated north of the country. Authorities believe that
terrorist cells from al-Qaida in the Islamic Maghreb, known to operate
in the north, are involved in smuggling as well as
kidnapping
 in law, the taking away of a person by force, threat, or deceit, with intent to cause him to be detained against his will. Kidnapping may be done for ransom or for political or other purposes.
 for ransom
as funds-generating activities. Malian authorities believe that proceeds
from cocaine trafficking into Europe from
South America
 fourth largest continent (1991 est. pop. 299,150,000), c.6,880,000 sq mi (17,819,000 sq km), the southern of the two continents of the Western Hemisphere.
 may be passed
through Malian banks, but lack the resources to make such a
determination.

Mali is a member of the
West African Economic and Monetary Union

 (
WAEMU

), which also includes Benin,
Burkina Faso
 , republic (2005 est. pop. 13,925,000), 105,869 sq mi (274,200 sq km), W Africa. It borders on Mali in the west and north, on Niger in the northeast, on Benin in the southeast, and on Togo, Ghana, and
, Cote D’Ivoire,
Guinea-Bissau, Niger, Senegal, and Togo. All of the WAEMU members share
a common currency, the (West African) CFA, and have developed a common
anti-money laundering/combating the financing of terrorism (AML/CFT)
framework, including legal and financial intelligence unit (
FIU

FIU Fire Investigation Unit
FIU Fraud Investigation Unit
FIU Facsimile Interface Unit
)
structures.

For additional information focusing on terrorist financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: Not available

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, the Public Treasury, microfinance
entities, the post office, currency exchanges, insurance companies and
brokers, securities and asset brokers and managers, the regional stock
exchange, mutual funds, casinos

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 15 in 2011

Number of CTRs received and time frame: 13 in 2011

STR covered entities: Specialized financial organizations, banks,
the Public Treasury, microfinance entities, the post office, currency
exchanges, insurance companies and brokers, securities and asset brokers
and managers, the regional stock exchange, mutual funds, attorneys,
notaries, auditors, real estate and travel agents, non-governmental
organizations, casinos and gaming establishments, and dealers of
high-value goods and precious metals and stones

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Six in 2011

Convictions: None in 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: YES

With other governments/jurisdictions: YES

Mali is a member of the Inter Governmental Action Group Against
Money Laundering in
West Africa

A region of western Africa between the Sahara Desert and the Gulf of Guinea. It was largely controlled by colonial powers until the 20th century.


West African adj. & n.
 (GIABA), a Financial Action Task Force
(FATF)-style regional body. Its most recent mutual evaluation report can
be found here: http://www.giaba.org/reports/mutual-evaluation/Mali.html

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Although Mali’s anti-money laundering law covers a number of
financial sectors, very few comply with their legal reporting
obligations. While businesses are technically required to report cash
transactions over approximately $10,000, most do not. With the exception
of casinos, designated non-financial businesses and professions are not
subject to customer due diligence requirements. While Mali criminalizes
tipping off for terrorist financing-related STRs in its December 2010
legislation, it does not appear to have criminalized tipping off in
relation to other types of STRs.

Mali’s financial intelligence unit, the
Cellule
 /cel·lule/ () a small cell.


n.
A small cell.
 Nationale de
Traitement des Informations Financieres (CENTIF), seeks closer relations
with foreign financial intelligence units, which will likely come to
pass since CENTIF became a member of the
Egmont Group

 of FIUs in 2011.
CENTIF’s staff includes secondments from the customs service,
police, and gendarme forces; additional training is needed for new
CENTIF staff members. Significant challenges to the effectiveness of
Mali’s AML/CFT regime remain, including a lack of resources to
perform outreach and mount
sensitization
 /sen·si·ti·za·tion/ ()
1. administration of an antigen to induce a primary immune response.

2. exposure to allergen that results in the development of hypersensitivity.
 and training for financial
institutions as well as other financial sectors.

Mali also lacks capacity in investigation of money laundering and
terrorist financing. For example, Mali lacks the capacity to trace
informal networks and money/value transfer systems, including hawalas.
There is also doubt as to whether the state prosecutor’s office
understands complex financial crimes sufficiently to be able to pursue
money laundering or terrorist financing crimes effectively and to a
successful prosecution. In the three years since CENTIF was organized,
there have been no successful prosecutions for AML/CFT violations.

Malta

Malta is not a regional financial center. Malta’s location
between North Africa and Italy makes it a transit point for narcotics
and human trafficking to Europe. Incidents of fraud, forgery, and

embezzlement
 wrongful use, for one’s own selfish ends, of the property of another when that property has been legally entrusted to one. Such an act was not larceny at common law because larceny was committed only when property was acquired by a “felonious taking,” i.
 are also a concern.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, currency exchange offices,
stockbrokers, insurance companies, money remittance/transfer services,
real estate agencies, auditors, accountants, notaries, tax advisors,
trust and asset managers, company formation agents, nominee
shareholders, casinos, auctioneers, and dealers in art, precious metals
and stones

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 73 in 2010

Number of CTRs received and time frame: Not applicable

STR covered entities: Banks, currency exchange offices,
stockbrokers, insurance companies, money remittance/transfer services,
real estate agencies, auditors, accountants, notaries, tax advisors,
trust and asset managers, company formation agents, nominee
shareholders, casinos, auctioneers, and dealers in art, precious metals
and stones

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Eight in 2010

Convictions: One in 2010

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: YES

With other governments/jurisdictions: YES

Malta is a member of the Committee of Experts on the Evaluation of
Anti-Money Laundering Measures and the Financing of Terrorism
(MONEYVAL), a Financial Action Task Force (FATF)-style regional body.
Its most recent mutual evaluation can be found here:
http://www.coe.int/t/dghl/monitoring/moneyval/Countries/Malta en.asp

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

The Malta Police Economic Crimes Squad is responsible for the
investigation of all financial related crimes. Its Money Laundering Unit
investigates reports sent by the financial intelligence unit as well as
reports from other sources.

The Government of Malta should continue to enhance its anti-money
laundering/counter-terrorist financing legislation and procedures, as
appropriate.

Marshall Islands
 officially Republic of the Marshall Islands, independent nation (2005 est. pop. 59,000), in the central Pacific. The Marshalls extend over a 700-mi (1,130-km) area and comprise two major groups: the Ratak Chain in the east, and the Ralik Chain in
 

The Republic of the Marshall Islands (
RMI

) is not a regional
financial center. It consists of 29 atolls and five islands, covering 70
square miles of land, spread across 750,000 square miles of ocean. The
country is not economically developed and has limited resources for
development. The RMI signed a Compact of Free Association with the
United States in 1986, and relies on the United States for the majority
of its economic support. There are no known terrorist or narcotics money
laundering activities in the Marshall Islands. There are two banks in
the country and no brokerage houses or other types of financial firms.
Land cannot be sold, and there are no realtors. There are no casinos in
the Marshall Islands.

The RMI offshore corporate sector is vulnerable to money
laundering. The Marshall Islands Trust Company and the Marshall Islands
Maritime & Corporate Administrators, Inc., provide for a robust
registration of corporations and ships. The RMI fleet is the third
largest flagged fleet in the world, although few of the vessels come to
the Marshall Islands. Available information indicates non-resident
corporations (NRCs), the equivalent of international business companies,
can be formed online. NRCs are allowed to offer
bearer

 shares, and
corporate officers, directors, and shareholders may be of any
nationality and live anywhere. NRCs are not required to disclose the
names of officers, directors, shareholders or beneficial owners, and
corporate entities may be listed as officers and shareholders. The
corporate registry program, however, does not allow the registering of
offshore banks, offshore insurance firms,
online gaming

 institutions, or
other companies which are financial in nature. Although NRCs must
maintain registered offices in the Marshall Islands, corporations can
transfer
domicile
 , one’s legal residence. This may or may not be the place where one actually resides at any one time. The domicile is the permanent home to which one is presumed to have the intention of returning whenever the purpose
 into and out of the RMI with relative ease. Marketers
of offshore services via the Internet promote the Marshall Islands as a
favored jurisdiction for establishing NRCs. In addition to NRCs, the
Marshall Islands offer
nonresident
  
adj.
1. Not living in a particular place:

2.
 trusts, partnerships,
unincorporated

 associations, and domestic and foreign limited liability companies. No
current information is available on the extent of offshore corporate
operations.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: Not defined

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Financial institutions; insurers, insurance
brokers and intermediaries; securities, exchange and interest rate
instruments dealers, futures and options funds and brokers, and
bullion

 dealers; businesses issuing, selling or redeeming travelers checks,
money orders, or similar instruments; payroll service businesses
involved in collecting, holding and delivering cash; gambling houses,
casinos, and lotteries; currency dealers and exchangers, and money
transmission services

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 14 from January 1 to
December 7, 2011

Number of CTRs received and time frame: 2,971 from January 1 to
December 7, 2011

STR covered entities: Financial institutions; insurers, insurance
brokers and intermediaries; securities, exchange and interest rate
instruments dealers, futures and options funds and brokers, and bullion
dealers; businesses issuing, selling or redeeming travelers’
checks, money orders, or similar instruments; payroll service businesses
involved in collecting, holding and delivering cash; gambling houses,
casinos, and lotteries; currency dealers and exchangers, and money
transmission services

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: None

Convictions: None

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: NO

With other governments/jurisdictions: YES

The Marshall Islands is a member of the Asia/Pacific Group on Money
Laundering (APG), a Financial Action Task Force (FATF)-style regional
body. Its most recent mutual evaluation can be found here:
http://www.apgml .org/documents/docs/17/RMI%20ME%202.pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

With the assistance of the United States and EU donors, the RMI
passed national laws that can be used to prosecute money laundering
crimes; however, these laws have not yet been used. The laws
criminalizing money laundering cover both individuals and corporations,
although predicate crimes are not defined either by list or an all
serious crimes approach. The statutes do not include
incarceration

 as a
penalty. Although there presently are no casinos in the RMI, they are
covered under the
AML

 laws. The RMI should establish disclosure
protections and
criminalize
  
tr.v. crim·i·nal·ized, crim·i·nal·iz·ing, crim·i·nal·iz·es
1. To impose a criminal penalty on or for; outlaw.

2. To treat as a criminal.
 tipping off. The RMI should also strengthen
KYC requirements, large currency transaction reporting, and records
retention.

The RMI should establish an independent national system and
mechanism for freezing terrorist assets in a timely manner.

The RMI should ensure its offshore sector is adequately supervised
and that information on company ownership and management is available to
law enforcement and supervisory authorities. The Marshall Islands signed
a tax treaty with Australia, and is in the process of signing tax and
other types of treaties with other nations. On September 29, 2011, it
became a party to the UN Convention against Transnational Organized
Crime and the UN
Convention against Corruption

.

Mauritania

The
Islamic Republic

 of Mauritania has a largely informal and
under-developed economy. Its economic system suffers from a combination
of weak government oversight, lax financial auditing standards, a large
informal trade sector, porous borders, lack of enforcement, and
corruption in government and the private sector. In recent years,
Mauritania has become a
transshipment point

 for cocaine from South
America intended for the European market. General smuggling, trafficking
in vehicles stolen mostly in Europe, parallel networks, and the
provision of logistical support for organized international drug
traffickers are all serious problems. Following the election of
President Mohamed Ould Abdel Aziz in July 2009, and in response to
increasing terrorist and illicit trafficking activities along its long
and porous borders with Algeria and Mali, the Government of Mauritania
(GOM) began an aggressive campaign against both corruption and the
terrorist network of al-Qaida in the Islamic Maghreb.

For additional information focusing on terrorism financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: NO Domestic:
YES

KYC covered entities: Banks and money exchangers and remitters

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: Five 2005–2011

Number of CTRs received and time frame: Not available

STR covered entities: Banks and money exchanges/remittance offices

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Four

Convictions: Two, and two awaiting judgment

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: YES

With other governments/jurisdictions: YES

Mauritania is a member of the Middle East and North Africa
Financial Action Task Force (
MENAFATF

). Its most recent mutual
evaluation report can be found here: www.menafatf.org

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

While Mauritania has been successful in creating a legal and
institutional framework to fight financial crimes, there remain many
challenges to its successful implementation of that framework,
especially given Mauritania’s cash-based and informal economy. All
legal entities, corporations, partnerships, and individuals are covered
under Mauritanian laws to prevent laundering and terrorist financing and
are subject to both criminal and civil penalties, depending upon the
crime committed.

The Financial Information Analysis Commission (CANIF),
Mauritania’s financial intelligence unit, would like to expand the
legal structure to include real estate holding companies and the
complete money/value transfer sector. Monitoring the informal financial
markets remains a challenge. Only 4% of Mauritanian adults have access
to a bank account, and the money/value transfer sector remains
vulnerable to exploitation. Mauritanian authorities are aware of these
issues and are working to formalize financial transactions to the extent
possible and to devise mechanisms to prevent the exploitation of the
remittance sector and other non-bank financial sectors. In 2011, two
orders were signed: Order N 640 promulgates an anti-money
laundering/counter-terrorism financing ruling covering non-financial
companies, real estate agents, and lawyers; and Order N 641 does the
same for non-governmental organizations.

President Aziz empowered the
Office of the Inspector General

 of the
State and the CANIF to lead efforts to identify, prevent, and reduce

corrupt practices
 in politics, fraud connected with elections. The term also refers to various offenses by public officials, including bribery, the sale of offices, granting of public contracts to favored firms or individuals, and granting of land or franchises in
 and financial crimes, including financial crimes
linked to narcotics and terrorist finance networks. CANIF falls under
the jurisdiction of the Central Bank of Mauritania and includes
representatives of the Mauritanian Ministries of Finance and Justice, as
well as the customs authority, national police, and
Gendarmerie
  
n.
1. A body of French gendarmes.

2. Slang A group of police officers.


[French, from Old French, calvary, from gent d'armes, gendarme,
 working
together to identify, investigate, prevent, and prosecute financial
crimes. In January 2011, CANIF released its first-ever annual report on
financial crime in Mauritania. Given that CANIF is a young organization,
there is still a great deal of work to be done to formalize its
operating procedures and build capacity.

Mauritius

Mauritius has developed a reputation as a well-regulated and
credible international financial center.
According to

prep.
1. As stated or indicated by; on the authority of:

2. In keeping with:

3.
 the
Mauritius’
Independent Commission Against Corruption

 (
ICAC
 
),
laundered funds are primarily the proceeds from drug trafficking–mainly
heroin, and increasingly, subutex. Other predicate crimes for money
laundering include larceny, conspiracy, forgery, swindling, and
corruption. While criminal proceeds are derived from both domestic and
foreign criminal activities, criminal proceeds laundered in Mauritius
are generally not controlled by drug trafficking organizations or
organized criminal groups. There is no significant black market for

smuggled
  
v. smug·gled, smug·gling, smug·gles

v.tr.
1. To import or export without paying lawful customs charges or duties.

2. To bring in or take out illicitly or by stealth.
 goods in Mauritius, although there is occasional smuggling of
stolen automobiles and cigarettes. According to ICAC, money laundering
occurs in the banking system, the offshore financial center, and the
non-bank financial system.

The Mauritius Global Business Sector is a major route for foreign
investments into the Asian
subcontinent
  
n.
1. A large landmass, such as India, that is part of a continent but is considered either geographically or politically as an independent entity.

2.
 and is by far the largest source
of foreign direct investment and portfolio investment in India. As of
September 2011, there were 27,670 Global Business Companies (GBCs) in
Mauritius, including 806 licensed global funds. The offshore sector also
includes management companies licensed by the Financial Service
Commission (
FSC

) to provide
professional services

 to GBCs. Shell
companies and bearer shares are not allowed in Mauritius nor are nominee
or anonymous directors or trustees.

The Mauritius Freeport, a free-trade zone (
FTZ

FTZ Forschungs- und Technologiezentrum der Deutschen Telekom
FTZ Finite Transmission Zero
FTZ Flush to Zero
), was established to
promote the country as a regional FTZ center for Eastern and Southern
Africa and the Indian Ocean rim. There are currently about 275 companies
which are active in Mauritius Freeport, with a turnover estimated at
$667 million.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, insurance companies, securities
dealers, money changers, foreign exchange dealers, accountants,
attorneys, barristers, notaries, chartered secretaries, gaming centers,

jewelry
 personal adornments worn for ornament or utility, to show rank or wealth, or to follow superstitious custom or fashion.

The most universal forms of jewelry are the necklace, bracelet, ring, pin, and earring.
 dealers, land promoters, property developers, estate agents

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 18 from January 2011 to
October 2011

Number of CTRs received and time frame: Not applicable

STR covered entities: Banks, insurance companies, securities
dealers, money changers, foreign exchange dealers, accountants,
attorneys, barristers, notaries, chartered secretaries, gaming centers,
jewelry dealers, land promoters, property developers, estate agents

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: 24 from January 2011 to October 2011

Convictions: 13 from January 2011 to October 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: NO

With other governments/jurisdictions: YES

Mauritius is a member of the Eastern and Southern Africa Anti-Money
Laundering Group (ESAAMLG), a Financial Action Task Force (FATF)-style
regional body. Its most recent mutual evaluation can be found here:
http://www.esaamlg.org/reports/view_me.php?id=173

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Limited training and capacity of the judiciary and the ICAC
compromises Mauritius’ ability to successfully implement its AML
regime. Stronger support of judges is needed to carry cases through to
successful prosecution.

Legislation to correct deficiencies and amend the AML framework has
been pending since 2006, but most of the amendments have not been tabled
in the National Assembly. Although coordination is possible via the 2003
Mutual Assistance in Criminal and Related Matters Act, international
cooperation, particularly sharing of information, is a lengthy and
uncertain process. Timely access to financial documents domestically
also is a problem. While Mauritius has a legal framework enabling it to
freeze terrorist-related assets without delay, its ability to do so is
subject to compliance with
judicial proceedings
 n. any action by a judge re: trials, hearings, petitions, or other matters formally before the court. (See: judicial)
.

The 2011 Asset Recovery Act, passed in the National Assembly in
April 2011, will take effect on February 1, 2012. The new law is
intended to enable the
forfeiture

 of proceeds of crimes to compensate
victims, whether the State or an individual. It contains provisions of
both conviction-based and non-conviction based forfeiture. The
Director
of Public Prosecutions

 n

 direct (Brit) n →  
 is designated to exercise enforcement powers
included in the law. Additionally, the law provides for the Recovered
Assets Fund, where forfeited assets would be placed.

Mexico

Mexico is a major drug-producing and drug-transit country. Proceeds
from the
illicit drug
 Street drug, see there
 trade leaving the United States are the principal
source of funds laundered through the Mexican financial system. Other
significant sources of laundered proceeds include corruption,
kidnapping, and trafficking in
firearms

 and persons. Sophisticated and
well-organized drug trafficking organizations based in Mexico take
advantage of the extensive U.S.-Mexico border, the large flow of
legitimate remittances, and the high volume of legal commerce to conceal
transfers to Mexico. The smuggling of bulk shipments of U.S. currency
into Mexico and the
repatriation

 of the funds into the United States via
couriers, armored vehicles, and wire transfers remain favored methods
for laundering drug proceeds. The combination of a sophisticated
financial sector and a large cash-based informal sector complicates the
problem. According to U.S. authorities, drug trafficking organizations
send between $19 and $39 billion annually to Mexico from the United
States, although the Government of Mexico (GOM) disputes this figure.
Mexico has seized over $500 million in bulk currency shipments since
2002.

For additional information focusing on terrorism financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: YES

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All crimes

Legal persons covered: criminally: NO civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, mutual savings companies, insurance
companies, securities brokers, retirement and
investment funds

,
financial leasing and factoring funds, casas de cambio, centros
cambiarios (unlicensed foreign exchange centers), savings and loans
institutions, money remitters, SOFOMES (multiple purpose corporate
entity),
SOFOLES
 
 (limited purpose corporate entity), and general deposit
warehouses

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 36,040–January through
September 2011

Number of CTRs received and time frame: 4.1 million–January
through September 2011

STR covered entities: Banks, mutual savings companies, insurance
companies, securities brokers, retirement and investment funds,
financial leasing and factoring funds, casas de cambio, centros
cambiarios (unlicensed foreign exchange centers), savings and loans
institutions, money remitters, SOFOMES (multiple purpose corporate
entity), SOFOLES (limited purpose corporate entity), and general deposit
warehouses

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: 54 from January to October 2011

Convictions: 13 from January to July 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: YES

With other governments/jurisdictions: YES

Mexico is a member of the Financial Action Task Force (FATF) and
the
Financial Action Task Force on Money Laundering

 in South America
(GAFISUD), a FATF-style regional body. Its most recent mutual evaluation
can be found here: http://www.fatfgafi.org/document/
20/0,3343,en_32250379_32236963_41911956_1_1_1_1,00.html

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

The GOM has taken some important steps to reduce the use of cash in
the economy and prevent the laundering of illicit drugs proceeds in U.S.
dollars (
USD

); however, the package of bills submitted in August 2010 to
further enhance anti-money laundering regulations remains in
limbo

 in
the Mexican Congress. In June 2010, the Finance Ministry implemented
regulations imposing limits on USD transactions in Mexico. The caps,
which later were eased for border areas, are applicable to cash
transactions from dollars to pesos, including deposits, credit payments,
and service fees. In addition to limiting transaction amounts for
individuals, all USD transactions are prohibited by the regulation for
corporate entities and trusts (including account and non-account holding
entities), except for those which are accountholders located in border
or tourist areas, for which transactions are limited. The impact of the
restrictions has been dramatic, with USD cash repatriation to the U.S.
from the Mexican formal financial sector dropping by 50%, or $7 billion.
The new destination for the USD cash no longer entering the Mexican
financial system remains an open question. Recent data does not support
the hypothesis that the flows would be redirected to
Central America
 narrow, southernmost region (c.202,200 sq mi/523,698 sq km) of North America, linked to South America at Colombia. It separates the Caribbean from the Pacific.
 and/or the Caribbean. U.S. and Mexican authorities have agreed to
continue studying the flow of U.S. currency.

In 2010, the GOM announced the National Strategy for the Prevention
and Elimination of Money Laundering and Financing for Terrorism. On
April 14, 2011, the Federal Executive sent to Congress a Bill of Decree
by which the Federal Criminal Code and the Federal Criminal Procedures
Code are to be amended. The bill includes a modification to the Federal
Criminal Code in order to expressly establish that a legal person is
liable for any money laundering/terrorist financing crimes, among
others, committed by any of its legal representatives acting on its
behalf. The bill is currently under review by the Senate. The government
also submitted a federal law for the Prevention and Identification of
Transactions with Criminal Proceeds, which was approved by the Senate on
April 28, 2011, and is currently under review by the Congress. The bill
includes, among other important aspects, restrictions on the use of cash
in certain transactions (i.e., real estate, jewelry, precious stones and
metals, games and lotteries, accounting and
legal services
 n. the work performed by a lawyer for a client.
).

On August 3, 2011, amendments were issued to the General Law of
Auxiliary Credit Organizations and Activities to establish the National
Banking and Securities Commission (
CNBV
 
) as the supervisory authority
for AML/CFT with regard to centros cambiarios, money remitters and
non-regulated SOFOMES. This authority will be transferred from the Tax
Administration System (SAT) to CNBV. The change was made in recognition
that the broad experience of CNBV on AML/CFT issues and its risk-based
approach to supervision will allow for better oversight of these
entities. The amendment provides for a transition period of 240 days.
The existing centros cambiarios and money remitters that registered
prior to August 4, 2011, or that requested their registration prior to
November 1, 2011, may continue with their operations if SAT approves
their registration. If the registration is denied, they must suspend
their operations. Any new centros cambiarios or money remitters which
did not request registration prior to November 1, 2011 are prohibited
from initiating operations until receipt of confirmation of registration
by SAT. After March 30, 2012, all requests for registration shall be
reviewed by CNBV. The general rule establishes that centros cambiaros
may only provide the services of buying, selling or exchanging currency,
within certain company formation restrictions and with
prior
authorization


n See predetermination.


 Health insurance A cost containment measure that provides full payment of health benefits only if the hospitalization or medical treatment has been
 from the
Ministry of Finance and Public Credit

. An
exception to the need for prior authorization is established for centros
cambiarios that provide the aforementioned services and do not exceed
the threshold of $10,000 per client per day.

In 2011, the GOM also issued a number of AML/CFT regulations
covering financial entities; specifically: General Provisions applicable
to Auxiliary Credit Organizations (issued on 5/31/11); General
Provisions applicable to SOFOLES (issued on 3/17/11); and General
Provisions applicable to SOFOMES (issued on 3/17/11). These regulations
strengthen reporting requirements and expand the range of entities
covered under AML/CFT provisions. The regulations represent concrete
steps forward, though until the final passage by the Senate of the 2010
package of anti-money laundering bills Mexico’s regulatory
framework will remain incomplete.

Mexico should amend its terrorist financing legislation to fully

comport

 with the UN Convention for the Suppression of the Financing of
Terrorism; and enact legislation and procedures to freeze without delay
terrorist assets of those designated by the UN 1267 Sanctions Committee.

Micronesia, Federated States of
 independent nation (2005 est. pop. 108,000), c.271 sq mi (702 sq km), an island group in the W Pacific Ocean. It comprises four states: Kosrae, Pohnpei (formerly Ponape), Chuuk (formerly Truk), and Yap.
 

The
Federated

 States of Micronesia (
FSM

) is not a regional or
offshore financial center. It has no free trade zones. Its geographic
isolation, small and relatively poor population, and limited
infrastructure make it a low risk for money laundering and terrorist
financing as well as smuggled goods. Money laundering activity primarily
originates from public corruption, including
bribery

 and misuse of

public funds

. Corruption extends to directing public contracts and
employment to unqualified companies or persons; there are no estimates
on the amount of money involved. Since both the executive and
legislative branches want to avoid scrutiny, they have not allocated
funds for a more robust anti-money laundering/counter-terrorist finance
program. Prosecutions are rare.

Both the legislative and executive branches of the government have
declined to allocate funds for FSM to join any
information sharing

 organization, which has stymied prosecution of cases with international
links. Should legislation authorizing the building of a casino in
Pohnpei or the building of a casino and tourist complex in Yap be
authorized and implemented, concerns for money laundering would rise.

Local law enforcement suspect some smuggled items, mostly
cigarettes, make their way onshore.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: NO Domestic:
NO

KYC covered entities: Financial institutions, cash dealers,
insurers, bingo parlors, trustees, and money transaction services

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: Not available

Number of CTRs received and time frame: Not applicable

STR covered entities: All banks and financial institutions

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: None

Convictions: None

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: NO

With other governments/jurisdictions: NO

The Federated States of Micronesia is not a member of a Financial
Action Task Force (FATF)-style regional body.

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

The Financial Intelligence Unit (FIU) of the National Police
receives suspicious transaction reports through the Department of
Justice (
DOJ

). The FIU consists of a single police officer. It has no
operational or budgetary independence, and relies entirely on the DOJ
for funding and the National Police for staff. The officer has both
criminal investigative and regulatory responsibilities. Inadequate
police training and lack of resources significantly diminish the
investigative abilities of both police and FIU staff. There have been no
arrests, prosecutions or convictions for money laundering since the FSM
criminalized the offense in 2001. The FSM should give the FIU
operational and budgetary independence, and build its overall capacity.

The FSM
ratified
  
tr.v. rat·i·fied, rat·i·fy·ing, rat·i·fies
To approve and give formal sanction to; confirm. See Synonyms at approve.
 the UN Convention for the Suppression of the
Financing of Terrorism in 2001. However, the country has yet to make
terrorist financing, or the commission of terrorist acts, specific
crimes. The FSM should make the criminalization of terrorist acts and
terrorist financing a priority, and establish an effective
implementation mechanism.

Money laundering statutes provide for the seizure of

tainted
  
v. taint·ed, taint·ing, taints

v.tr.
1. To affect with or as if with a disease.

2. To affect with decay or putrefaction; spoil. See Synonyms at contaminate.

3.
” property, as well as any benefits derived from the
commission of a money laundering offense. However, no property has ever
been seized or
confiscated
  
tr.v. con·fis·cat·ed, con·fis·cat·ing, con·fis·cates
1. To seize (private property) for the public treasury.

2. To seize by or as if by authority. See Synonyms at appropriate.

adj.
 under the money laundering statute. There is
no civil forfeiture. The FSM should support the investigation of money
laundering cases and the seizure and
confiscation

 of assets where
appropriate.

Local institutions and personnel lack the training and capacity to
fully enforce the law and its attendant regulations. Although legally
obligated, only one of the two banks in FSM currently reports STRs.

The FSM should become a party to the UN Convention against
Corruption.

Moldova

Moldova is not considered a regional financial center. The
Government of Moldova (GOM) monitors money flows throughout the country,
but does not exercise control over its breakaway region of Transnistria.
Transnistrian authorities do not
adhere to

verb 1. , keep, maintain, respect, observe, be true, fulfil, obey, heed, keep to, abide by, be loyal, mind, be constant, be faithful

2.
 GOM financial controls and
accepted anti-money laundering norms, and maintain a banking system
independent of and not licensed by the National Bank of Moldova.
Criminal proceeds laundered in Moldova derive substantially from
tax
evasion

, contraband smuggling, and corruption. Money laundering has
occurred in the banking system and in exchange houses, along with
offshore financial centers in Transnistria. Fifteen banks constitute the
Moldovan financial system. Neither offshore banks nor shell companies
are permitted to operate in Moldova. Internet gaming sites do exist,
although no statistics are available on the number of sites in
operation. Internet gaming comes under the same set of regulations as
domestic casinos. Enforcement of the regulations is sporadic.

Moldova contains six free trade zones (FTZs), some of which are
infrequently used. Reportedly, goods from abroad are sometimes imported
into the FTZ and then resold and exported to other countries with
documentation indicating Moldovan origin. Companies operating in FTZs
are subject to inspections, controls, and investigations by inspectors
from the Customs Service and the Center for Combating Economic Crime and
Corruption.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, currency exchange offices, investment
funds, investment management companies, deposit companies, fiduciary
companies, securities dealers, stock exchange companies, brokers,
insurance and
reinsurance

 companies, company formation agents and
ownership registries, gaming and lottery organizers and institutions
(including Internet casinos), real estate agents, dealers of precious
metals or gems, auditors, accountants and financial consultants,
investment or fiduciary service providers, lawyers, notaries, and
organizations which provide postal and telephone mandate exchange or
transfer of resource services

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 215,214 from January to
October 2011

Number of CTRs received and time frame: 16,480 from January to
October 2011

STR covered entities: Banks, currency exchange offices, investment
funds, investment management companies, deposit companies, fiduciary
companies, securities dealers, stock exchange companies, brokers,
insurance and reinsurance companies, company formation agents and
ownership registries, gaming and lottery organizers and institutions
(including Internet casinos), real estate agents, dealers of precious
metals or gems, auditors, accountants and financial consultants,
investment or fiduciary service providers, lawyers, notaries, and
organizations that provide postal and telephone mandate exchange or
transfer of resource services

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Seven from January to October 2011

Convictions: Eight from January to October 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: YES

With other governments/jurisdictions: YES

Moldova is a member of the Committee of Experts on the Evaluation
of Anti-Money Laundering Measures and the Financing of Terrorism
(MONEYVAL), a Financial Action Task Force (FATF)-style regional body.
Its most recent mutual evaluation can be found here:
http://www.coe.int/t/dghl/monitoring/moneyval/Countries/Moldova en.asp

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Moldova has made some progress in instituting a legal framework for
combating money laundering that is consistent with international
standards. However, in November 2010, the Constitutional Court struck
down some of the most relevant provisions of the anti-money laundering
law. Specifically, the Court
invalidated
  
tr.v. in·val·i·dat·ed, in·val·i·dat·ing, in·val·i·dates
To make invalid; nullify.


in·val
 the provisions of the law
enabling the Financial Intelligence Unit (FIU) to collect STRs and
temporarily freeze accounts suspected of involvement in illegal
activity. The GOM reacted by issuing a decision re-establishing the
requirement for financial institutions to report STRs to the FIU. In
addition, on April 7, 2011, Moldova’s parliament enacted amendments
to the anti-money laundering law which defines the STR reporting
obligations according to international standards, sets an equivalent
$10,000 threshold for reporting cash transactions, provides additional
autonomy for the FIU, and regulates the FIU’s ability to freeze
accounts involved in suspicious transactions. The enactment of the
anti-money laundering amendments has had a positive impact on the
FIU’s institutional development. In addition, the FIU increased its
operational capacity by securing electronic access to more governmental
databases.

Moldova should continue to review and amend the criminal procedure
code to institute non-conviction based confiscation and to permit
special investigative techniques to be applied to a wider range of
offenses associated with money laundering and terrorist financing.
Additionally, the GOM should criminalize tipping off.

Monaco

The Principality of Monaco is the second-smallest country in
Europe. It is linked closely to France and is tied to the economic
apparatus of the European Union (EU) through its
customs union

 with
France and its use of the euro as its official currency. Monaco is known
for its security and political stability. Monaco’s state budget is
based primarily on taxes, duties, and excises which account for 75% of
the total income; casino revenues constitute less than 3% of the state
budget. Private banking and fund management dominate the financial
sector. Monaco’s 36 banks and three financial institutions hold
more than 300,000 accounts and manage total assets of about 750 billion
euros (approximately $102.8 billion). Nonresidents total 46% of the
financial institutions’ total number of clients, representing 60%
of the total assets and deposits, respectively almost 84,000 clients and
45 billion euros (approximately $57.6 billion). Money laundering charges
relate mainly to offenses committed abroad. Reportedly, the Principality
does not face ordinary forms of organized crime, nor is there a
significant market for smuggled goods.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, financial institutions, casinos,
trustees and company service providers

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 637 in 2010

Number of CTRs received and time frame: Not available

STR covered entities: Banks; insurance companies; stockbrokers;
corporate service providers; portfolio managers; some trustees;
institutions within the offshore sector; casinos; money remitters; real
estate brokers; consultants or advisors in business, legal or tax
matters; dealers in precious
stones, precious
 see gem.
 materials,
antiquities

,
fine art and other valuable assets; lawyers; notaries; accountants

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: 21 in 2010

Convictions: 14 in 2010

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: YES

With other governments/jurisdictions: YES

Monaco is a member of the Committee of Experts on the Evaluation of
Anti-Money Laundering Measures and the Financing of Terrorism
(MONEYVAL), a Financial Action Task force (FATF)-style regional body.
Its most recent mutual evaluation can be found here:
http://www.coe.int/t/dghl/monitoring/moneyval/Countries/Monaco en.asp

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

The Government of Monaco (GOM) should enhance the authority of its
financial intelligence unit (FIU) to forward reports and share financial
intelligence with law enforcement and foreign FIUs even when the report
or information obtained does not relate specifically to drug
trafficking, organized crime, or terrorist financing.

The GOM should become a party to the UN Convention against
Corruption.

Mongolia

Mongolia is not a regional financial center. There are few
financial and economic crimes, although numbers have increased in the
last five years. Mongolia is vulnerable to low-grade
transnational crime

 due to the growth in tourism, investment, and remittances from abroad,
but the overall rate of these crimes has not increased. The increase in
reports of suspicious transactions is more likely a product of the
increasing effectiveness and experience of the Bank of Mongolia’s
Financial Information Unit (FIU).

Mongolia’s limited capacity to monitor its extensive borders
with Russia and China is a liability in the fight against smuggling and
narcotics trafficking, but drug use and trafficking remain limited and
unsophisticated. There is a black market for smuggled goods, which
appears largely tied to
tax avoidance

 rather than drug trafficking.
There are no indications that international narcotics traffickers
exploit the banking system, and no instances of terrorist financing have
been reported.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: NO civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, non-bank financial institutions,
savings and credit cooperatives, insurance companies, securities
dealers, foreign exchange units, pawnshops and casinos (though casinos
are currently prohibited in Mongolia)

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 56 from January 1–November
1, 2011

Number of CTRs received and time frame: Over 300,000 from January
1–November 1, 2011

STR covered entities: Banks

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: None

Convictions: None

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: YES

With other governments/jurisdictions: YES

Mongolia is a member of the Asia/Pacific Group on Money Laundering,
a Financial Action Task Force (FATF)-style regional body. Its most
recent mutual evaluation can be found here:
http://www.apgml.org/documents/
docs/17/Mongolia%20Mutual%20Evaluation%202007%20%20Final%20.pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

The Bank of Mongolia’s FIU expanded international cooperation
by signing MOUs with the FIUs of Taiwan, Slovenia and Moldova. The
Government of Mongolia (GOM) should strengthen cooperation by
implementing a system for the identification and forfeiture of assets,
along with arrangements for asset sharing. The GOM should also provide

safe harbor

 protection for individuals and entities filing STRs and
cooperating with authorized investigations, while also criminalizing
“tipping off subjects of this reporting.

Although the Parliament passed a law on December 24, 2009, which
improved AML/CFT efforts, it failed to bring Mongolia into compliance
with international standards, and it is not clear that the GOM has the
capacity fully to enforce this law. Deficiencies include inadequate
criminalization of money laundering and terrorist financing, lack of
adequate procedures to identify and freeze terrorist assets, and the
absence of a fully operation and effectively functioning financial
intelligence unit, among others.

The GOM should work to improve its legal framework by passing
amendments to bring its system fully in line with international
standards and
dedicate
  
tr.v. ded·i·cat·ed, ded·i·cat·ing, ded·i·cates
1. To set apart for a deity or for religious purposes; consecrate.

2.
 the necessary resources to enforce the
provisions. While highly professional, the FIU appears under-staffed,
and coordination with other law enforcement organizations reportedly
remains deficient. The increasing financial flows in advance of an
expected mining-driven boom create a distinct challenge to the Mongolian
FIU. Although five cases were opened during the year, the lack of a
single successful prosecution to date illustrates the enforcement
problem.

Montenegro

Since its independence in 2006, Montenegro has struggled to improve
its capacity to prevent and address money laundering, along with other
aspects of organized crime and corruption. Legislative reforms have put
in place a legal infrastructure, however, little action has been taken
to proactively investigate and prosecute suspected cases of money
laundering, raising concerns about the ability and will of the

Government of Montenegro

 (GOM) to effectively combat this component of
crime.

Criminal organizations, including sophisticated international
narcotics trafficking enterprises, have a presence in Montenegro, and
the country is also part of transit routes used to
smuggle
  
v. smug·gled, smug·gling, smug·gles

v.tr.
1. To import or export without paying lawful customs charges or duties.

2. To bring in or take out illicitly or by stealth.
 narcotics and
other contraband. Within Montenegro there exists a significant black
market for smuggled items such as stolen cars, narcotics, cigarettes,
and counterfeit products. Many of these items are trafficked by
organized criminal groups. This criminal activity, and the money
laundering and corruption connected to it, is a cause of concern for
both the GOM and the international community. Evidence exists that the
proceeds of narcotics trafficking and other illegal activities are being
laundered through businesses engaged in food service and gambling, along
with construction and real estate transactions. Factors that increase
Montenegro’s vulnerability to and facilitate money laundering are
the high use of cash for purchases and Montenegro’s use of the euro
without being within the Euro Zone.

Investigations by Montenegrin government agencies into organized
crime operations and suspicious financial transactions show money moving
from and through foreign off-shore financial institutions, including
institutions located in the
British Virgin Islands

A British colony in the eastern Caribbean east of Puerto Rico and the U.S. Virgin Islands. Road Town, on Tortola Island, is the capital. Population: 21,700.

Noun 1.
, Cyprus, the
Seychelles, Panama, and Switzerland. Funds transferred from these
institutions are being used to purchase real estate and luxury
consumer
goods

, and to invest in businesses.

Proceeds of criminal enterprises fuel corruption which impacts law
enforcement organizations and the judiciary in Montenegro. The origin of
funds used to acquire companies or businesses during
privatization
 see nationalization.


privatization

Transfer of government services or assets to the private sector. State-owned assets may be sold to private owners, or statutory restrictions on competition between privately and publicly owned
 is
often unclear and the transactions lack transparency. In spite of the
existence of a legislative framework and several anti-corruption bodies,
the overall coordination and implementation of anti-corruption efforts
remain insufficient.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: List approach

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, savings banks,
savings and loan
 n. a banking and lending institution, chartered either by a state or the Federal government. Savings and loans only make loans secured by real property from deposits, upon which they pay interest slightly higher than that paid by most banks.
 institutions, loan brokers, and other financial institutions;
organizations performing payment, payment or credit card transactions,
and post offices; stock brokers and investment and pension fund
managers; insurance brokers and companies dealing with life assurance;
organizers of lotteries and special games of chance; exchange offices;
pawnshops; audit companies, independent auditors and tax advice
services; institutions for issuing electronic money; humanitarian,
nongovernmental and other non-profit organizations; and those engaged
in: sale and purchase of claims; factoring, safekeeping and
guaranty

;
property management; financial leasing; travel organization; real estate
trade; motor vehicle, vessel and aircraft trade; credit agencies; and
auctioneers and traders of works of art, precious metals and stones, and
other high value goods

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 60 from January 1 to
September 30, 2011

Number of CTRs received and time frame: 38,563 from January 1 to
September 30, 2011

STR covered entities: Banks, savings banks, savings and loan
institutions, loan brokers, and other financial institutions;
organizations performing payment, payment or credit card transactions,
and post offices; stock brokers and investment and pension fund
managers; insurance brokers and companies dealing with life assurance;
organizers of lotteries and special games of chance; exchange offices;
pawnshops; audit companies, independent auditors and tax advice
services; institutions for issuing electronic money; humanitarian,
nongovernmental and other non-profit organizations; and those engaged
in: sale and purchase of claims; factoring, safekeeping and guaranty;
property management; financial leasing; travel organization; real estate
trade; motor vehicle, vessel and aircraft trade; credit agencies; and
auctioneers and traders of works of art, precious metals and stones, and
other high value goods

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: One during the first six months of 2011

Convictions: None from January 1 to November 1, 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: YES

With other governments/jurisdictions: YES

Montenegro is a member of the Committee of Experts on the
Evaluation of Anti-Money Laundering Measures and the Financing of
Terrorism (MONEYVAL), a Financial Action Task Force (FATF)-style
regional body. Its most recent mutual evaluation can be found here:
http://www.coe.int/t/dghl/monitoring/moneyval/Countries/Montenegro_en.asp

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Harmonization
  
v. har·mo·nized, har·mo·niz·ing, har·mo·niz·es

v.tr.
1. To bring or come into agreement or harmony. See Synonyms at agree.

2. Music To provide harmony for (a melody).
 of Montenegro’s anti-money
laundering/counter-terrorist financing (AML/CFT) laws with international
standards is still pending completion. However, with Montenegro ready to
start the EU negotiation process, added pressure will exist to adopt all
the appropriate legislation. The basic legal and institutional framework
to deal with ML/TF is in place and cooperation between the financial
supervisory authorities and law enforcement has been established;
however, the operational and investigative capacities of law enforcement
and the judiciary need further enhancement. Police and prosecutors need
to improve their collection and management of data and their capacity to
investigate financial crimes. Financial investigations in two
high-profile cases led to the temporary seizure of assets. Still, the
number of financial investigations and criminal asset forfeitures remain
low. During the first ten months of 2011, the financial intelligence
unit (FIU) forwarded 25 suspicious transactions to the
law enforcement
agencies

 for further processing, but there were no convictions for ML or
TF.

The system for reporting suspicious transactions also needs
improvement, although the banking sector improved its STR reporting. The
Administration for Prevention of Money Laundering, Montenegro’s
FIU, lacks sufficient
human resources

 (in spite of the slight increase
of resources in 2011), workspace, and IT equipment to deal with its
numerous assignments. The FIU is not completely independent from the
Ministry of Finance, impeding its ability to investigate all claims of
AML. Furthermore, remuneration is generally low in all AML/CFT-related
agencies, and the staff turnover and limited technical capacity are
hampering their effective functioning.

The framework for international judicial cooperation in ML/TF cases
is generally comprehensive. Although the GOM has signed bilateral
cooperation agreements with a number of countries, the country needs to
strengthen their implementation. During 2011, Montenegro signed
bilateral agreements on cooperation in ML/TF exchanges of financial
intelligence data with Armenia, British Virgin Islands,
Great Britain
 officially United Kingdom of Great Britain and Northern Ireland, constitutional monarchy (2005 est. pop. 60,441,000), 94,226 sq mi (244,044 sq km), on the British Isles, off W Europe. The country is often referred to simply as Britain.
 and Aruba.

In August 2010, the GOM announced that persons with a credible
global reputation will be able to obtain Montenegrin citizenship if they
directly invest at least 500,000 euros (approximately $689,100) in
Montenegro and its economy. This economic citizenship or
citizenship-by-investment program was suspended at the end of 2010 but
was never formally overturned.

Although legal and institutional mechanisms to fight corruption
were strengthened, the perception of corruption remains widespread, due
to the lack of convictions, which potentially affects efforts to combat
money laundering. A Joint Investigative Team, consisting of
representatives of law enforcement bodies and headed by the
Special
Prosecutor

 see independent counsel.
, was formally re-established on June 18, 2011. A National
Commission for implementing the 2010 Strategy for Prevention of Money
Laundering and Terrorist Finance has been established, made up of
representatives from the relevant institutions. Although it may be
argued there is still no clear division of competencies among the
different anti-corruption bodies, some efforts were made in the fight
against organized crime and enhancing regional cooperation.

Montenegrin authorities do not consider Montenegro to be exposed to
terrorism or a haven for terrorist finance. Unlike previous years, the
FIU examined two possible cases of terrorist financing involving 26
non-residents and two non-resident business entities. According to the
FIU, Montenegrin officials have not recognized the existence of informal
systems of financial transfers or alternative remittance systems. In its
2011 progress report, the EU noted the country’s capacity to detect
actions related to terrorism remained limited.

Montserrat

Montserrat has one of the smallest financial sectors of the
Caribbean Overseas Territories of the United Kingdom (UK). The volcanic
eruption in 1995 reduced the population and business activity on the
island and disrupted the economy, which is still recovering. Less than
5,000 people remain resident on the island. Montserrat’s
operating
budget

 is largely supplied by the British government and administered
through the Department for International Development.

There are few offenses committed in Montserrat that generate
substantial profits from crime. The low level of transactions generated
in the financial sector suggests that criminal monies are not entering
the mainstream economy through financial institutions.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: NO

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
NO

KYC covered entities: Banks, securities dealers, money transmission
services, company management services, and financial leasing companies

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: Not available

Number of CTRs received and time frame: Not applicable

STR covered entities: Banks, securities dealers, money transmission
services, company management services, and financial leasing companies

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Not available

Convictions: Not available

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: YES

With other governments/jurisdictions: YES

Montserrat is a member of the Caribbean Financial Action Task Force
(
CFATF

), a Financial Action Task Force (FATF)-style regional body. Its
most recent mutual evaluation can be found here:
http://www.imf.org/external/pubs/ft/scr/2003/cr03371.pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Montserrat IBCs, LLCs and LPs, typically used for international
business, are required to have a locally licensed company manager as
registered agent, or in the case of trusts, a locally licensed trust
company, with responsibility for undertaking KYC and monitoring the AML
compliance of their clients.

The lack of resources and personnel may reduce the effectiveness of
those regulations that are in place. Recent evaluations note the
Financial Services Commission is not adequately structured and staffed
so as to effectively carry out its functions; there are insufficient
human resources; the staff for money laundering investigations also
performs other policing functions; and there is a need for additional
training in AML/CFT issues for customs officials.

Montserrat is a British Overseas Territory and cannot sign or

ratify
 v. to confirm and adopt the act of another even though it was not approved beforehand. Example: An employee for Holsinger’s Hardware orders carpentry equipment from Phillips Screws and Nails although the employee was not authorized to buy anything.
 international conventions in its own right. Rather, the UK is
responsible for Montserrat’s
international affairs

 and may arrange
for the
ratification

 of any convention to be extended to Montserrat. The
1988 Drug Convention was extended to Montserrat in 1995. The UN
Convention against Corruption, the International Convention for the
Suppression of the Financing of Terrorism, and the UN Convention against
Transnational Organized Crime have not yet been extended to Montserrat.

Morocco

Morocco is not a regional financial center but is well integrated
into the international financial system. Money laundering is a concern
due to Morocco’s international narcotics trade, vast informal
sector, trafficking in persons, and large level of remittances from
Moroccans living abroad. Cash-based transactions in connection with
Morocco’s substantial trade in
cannabis
 see hemp; marijuana.


cannabis

Any plant of the genus Cannabis, which contains a single species, C. sativa. It is widely cultivated throughout the northern temperate zone.
 are of particular concern.
While some of the narcotics proceeds are laundered in Morocco, most
proceeds are thought to be laundered in Europe. Approximately three of
ten Moroccans use banks, while credible estimates of Morocco’s
informal financial sector place it at nearly 15% of
GDP
 (guanosine diphosphate): see guanine.
. The predominant
use of cash, money/value transfer systems (
MVTS

MVTS Motor Vehicle Tampering Survey
) and remittances from
abroad help fuel Morocco’s informal financial sector. In 2010,
remittances from Moroccans living abroad were approximately 7% of GDP
and drove household consumption by large segments of the population.

Offshore banks are located in the Tangier Free Zone. They are
regulated by an interagency commission chaired by the Ministry of
Finance. The free trade zone (FTZ) also allows customs exemptions for
goods manufactured in the zone for export abroad. Morocco’s
financial intelligence unit (FIU) reports suspicion of money laundering
schemes using the Tanger-Med FTZ.

Criminal activities of particular risk include bulk cash smuggling
and unverified reports of trade-based money laundering, including under-
and over-invoicing and the purchase of smuggled goods. Most businesses
are cash-based with little invoicing or paper trails.
Unregulated

 money
exchanges remain a problem in Morocco and were a prime impetus for
Morocco’s anti-money laundering legislation. Although the
legislation targets previously unregulated cash transfers, the
country’s vast informal sector creates conditions for this practice
to continue.

For additional information focusing on terrorism financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: List approach

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: NO Domestic:
NO

KYC covered entities: Domestic and offshore banks, finance
companies, insurance industry, lawyers, accountants, real estate
intermediaries, and gaming operators

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 86 from July 2010-June 2011

Number of CTRs received and time frame: Not applicable

STR covered entities: Domestic and offshore banks, finance
companies, insurance industry, lawyers, accountants, real estate
intermediaries, and gaming operators

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Six from November 2010-October 2011

Convictions: One from November 2010-October 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: YES

With other governments/jurisdictions: YES

Morocco is a member of the Middle East and North Africa Financial
Action Task Force (MENAFATF), a Financial Action Task Force (FATF)-style
regional body. Its most recent mutual evaluation can be found here:
http://www.menafatf.org/TopicList.asp?cType=train

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Overall, the Government of Morocco (GOM) has made considerable
progress since the
promulgation

 of the 2007 AML law. Morocco has taken
significant action in an effort to address the majority of the
deficiencies included in its action plan but is still working to
criminalize terrorist financing adequately. Morocco continues to refine
and expand its AML/CFT legal framework. In January 2011, Morocco
expanded the list of entities required to report suspicious transactions
in order to close many of the gaps in existing regulations and bring
them into line with international standards. Moroccan authorities should
continue to develop regulatory oversight and investigative expertise
that targets Morocco’s large MVTS sector, especially money
remittance networks. Morocco should also work to address trade-based
money laundering.

Although not explicitly stated, the FIU considers PEPs, both local
and foreign, to be high-risk.

Morocco’s FIU more than doubled its staff between the middle
of 2010 and the end of 2011 and joined the Egmont Group of FIUs in July
2011. Morocco’s ability to enforce its anti-money laundering
statutes should improve as the FIU continues to build capacity.

Mozambique

Mozambique is not a regional financial center. Money laundering is
believed to be fairly common and is linked principally to customs fraud
and narcotics trafficking. Most narcotics are believed to be
destined
  
tr.v. des·tined, des·tin·ing, des·tines
1. To determine beforehand; preordain:

2.
 for South African and European markets although consumption is on the
rise in Mozambique, mainly of cannabis and mandrax. Mozambique is not a
primary transshipment point of drugs to the United States. Local
organized crime groups control narcotics trafficking operations in the
country, and are thought to involve networks with links to Pakistani and
Indian nationals and immigrants. Other common predicate offenses for
money laundering include: corruption, human trafficking, car theft,
robbery, cash smuggling, illicit trade in precious metals and stones,
and general smuggling. Most of the illegal activities have
manifestations of organized crime, and are transnational in nature.
Authorities believe the proceeds from these illicit activities have
helped finance commercial real estate developments, particularly in the
capital.

While money laundering in the banking sector is considered to be a
serious problem, foreign currency exchange houses, cash couriers, and
the
hawala

 remittance system play more significant roles in financial
crimes and money laundering. For instance, much of the laundering is
believed to be happening behind the scenes at foreign currency exchange
houses, and the number of exchange houses operating in Mozambique
surpasses the number required for normal business. Black markets for
smuggled goods and informal financial services are widespread, dwarfing
the formal retail and banking sectors in most parts of the country.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: YES

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: List approach

Legal persons covered: criminally: YES civilly: NO

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: NO Domestic:
NO

KYC covered entities: Banks and credit companies; securities
companies and exchanges; debt collectors, leasing and rental companies;
gaming facilities; capital/asset management concerns; payment and
currency exchange operators; insurance brokers; and overseas
subsidiaries or branches of Mozambican financial institutions

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: Not available

Number of CTRs received and time frame: Not available

STR covered entities: Banks and credit companies; securities
companies and exchanges; debt collectors, leasing and rental companies;
gaming facilities; capital/asset management concerns; payment and
currency exchange operators; insurance brokers; and overseas
subsidiaries or branches of Mozambican financial institutions

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: None

Convictions: None

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: NO

With other governments/jurisdictions: YES

Mozambique is a member of the Eastern and Southern Africa
Anti-Money Laundering Group (ESAAMLG), a Financial Action Task Force
(FATF)-style regional body. Its most recent mutual evaluation can be
found here: http://www.esaamlg.org/userfiles/
Mozambique_Mutual_Evaluation_Detail_Report(5).pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Limited resources and high levels of corruption hamper the
Government of Mozambique’s (GOM) ability to fight money laundering
and terrorism financing. Local institutions, including police, customs,
and judicial authorities, lack the funding, training, and personnel
necessary to investigate money laundering activities and enforce the
law.

Drug trafficking and related money laundering are serious issues in
Mozambique. The Financial Intelligence Office (
FIO

) was established in
2007, but only hired its initial staff in 2010. It was not clear if the
FIO was operational in 2011. In 2011, the Central Office to Combat
Corruption opened new offices and added additional staff.

Authorities acknowledge that alternative remittance systems are
common in Mozambique. Many operate in exchange houses that, on paper,
are heavily regulated but in fact can easily avoid reporting
requirements. New foreign currency regulations adopted in 2011, aimed in
part at restricting transactions at these foreign exchange houses, are
intended to reduce money laundering by requiring customers with foreign
currency accounts at local banks to change that foreign currency into
meticais, the local currency, rather than receiving foreign currency for
domestic use.

In September 2011, the GOM completed its investigation of prominent
businessman, Mohamed Bachir Suleman, who was placed on the Department of
Treasury’s Drug Kingpin list in 2010. While the GOM found

insufficient evidence
 n. a finding (decision) by a trial judge or an appeals court that the prosecution in a criminal case or a plaintiff in a lawsuit has not proved the case because the attorney did not present enough convincing evidence.
 of drug trafficking, it found extensive tax,
customs and foreign exchange violations, and commenced administrative
action against him for payment of back taxes and fines.

Namibia

Namibia is not a regional financial center, although it has one of
the most highly developed financial systems in Africa. Sources of
potential money laundering in Namibia are related to both regional and
domestic criminal activities.
Falsification
 /fal·si·fi·ca·tion/ () lying.


retrospective falsification  unconscious distortion of past experiences to conform to present emotional needs.
 or misuse of identity
documents, customs violations, trafficking of precious metals and gems,
trafficking in illegal drugs, and stolen vehicles–mostly from
South
Africa

 Afrikaans Suid-Afrika, officially Republic of South Africa, republic (2005 est. pop. 44,344,000), 471,442 sq mi (1,221,037 sq km), S Africa.
 are regional problems that affect Namibia. Organized crime groups
involved in smuggling activities generally use Namibia as a transit
point, particularly for goods destined for Angola. Domestically, real
estate as well as minerals and gems are suspected to be used as vehicles
for money laundering. Namibian authorities believe the proceeds of these
activities are laundered through Namibian financial institutions, but on
a small scale. The organized fencing of stolen goods, not just vehicles,
is also a problem in Namibia. The Namibian government has set up Export
Processing Zones.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: NO Domestic:
NO

KYC covered entities: Banks, microfinance entities, pension funds,
asset managers and trust companies, casinos and gaming institutions,
exchange houses, stock brokerages, cash couriers, casinos, dealers in
jewels and precious metals, insurance companies, pawn shops, realtors,
dealers in high-value art and vehicles, auctioneers to include livestock
and real estate, lawyers, accountants and notaries

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 297 from May 2009 to
November 2011

Number of CTRs received and time frame: Not applicable

STR covered entities: Banks, microfinance entities, pension funds,
asset managers and trust companies, exchange houses, stock brokerages,
cash couriers, casinos, dealers in jewels and precious metals, insurance
companies, pawn shops, realtors, dealers in high-value art and vehicles;
auctioneers to include livestock and real estate, lawyers, accountants
and notaries

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: None

Convictions: None

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: YES

With other governments/jurisdictions: YES

Namibia is a member of the Eastern and Southern Africa Anti-Money
Laundering Group (ESAAMLG), a Financial Action Task Force (FATF)-style
regional body. Its most recent mutual evaluation can be found here:
http://www.esaamlg.org/userfiles/Namibia detailed report.pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Namibia is revising its anti-money laundering (AML) framework to
change from a rules-based to a risk-based approach. In certain
subsectors regulatory bodies cannot impose sanctions, such as the
withdrawal of licenses, for those entities that are not complying with
Namibia’s AML framework. There are separate draft bills to cover
gambling and estate agents that would augment the powers of regulatory
authorities to monitor and enforce Namibia’s AML framework.

Four arrests were made for money laundering, but prosecution is
still pending. The Office of the Prosecutor General has successfully
applied for ten Preservation/Provisional Forfeiture orders, pending the
criminal
litigation

. No asset forfeitures have taken place.

Although enhanced due diligence requirements for PEPs are not
specified by law, the Financial Intelligence Center has issued guidance
to accountable institutions instructing them to conduct enhanced due
diligence on high-risk clients, which includes PEPs.

Namibia has not reached a bilateral agreement with United States
authorities on a mechanism for exchange of records in criminal matters.
However, Namibia has made substantial efforts to cooperate with the
United States in the area of law enforcement, especially in the area of

extradition
 , delivery of a person, suspected or convicted of a crime, by the state where he has taken refuge to the state that asserts jurisdiction over him.
, and has provided four intelligence reports to its U.S.
counterparts. Namibia has cooperative agreements with countries in the
Southern African Development Community.

Namibia should continue to implement its AML laws and should pass
the pending anti-terrorism bill. As part of the implementation process,
the Government of Namibia (GON) should ensure sufficient resources and
training are provided to supervisory, analytical, investigative,
prosecutorial and judicial entities with responsibilities under the
laws. Namibia should establish and implement procedures to freeze
terrorist assets. The GON also should take steps to ensure a fully
operational and effectively functioning financial intelligence unit
(FIU), in particular addressing the operational autonomy of the FIU.
Cross-border currency reporting should be implemented and further
measures taken to enforce Namibia’s porous borders. The GON should
become a party to the UN Convention for the Suppression of the Financing
of Terrorism.

Nauru

Nauru is a small Central Pacific island nation with a population of
approximately 10,000. A member of the British Commonwealth, Nauru is an
independent republic but uses Australian currency. Nauru is an
established “zero” tax haven, as it does not levy any income,
corporate, capital gains, real estate, inheritance, estate, gift, sales,
or stamp taxes. Only a 7%
value added tax
 n (BRIT) → )

 n (Brit
 on all goods and an airport
departure tax imposed on all departing passengers are in place. There
are no commercial banks on Nauru. Nauru’s loose legal, supervisory,
and regulatory framework has provided significant money laundering
opportunities for offshore syndicates in the past decade. There is no
known domestic criminal activity in Nauru that generates laundered
funds.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: Not available

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Not available

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: None in 2011

Number of CTRs received and time frame: None in 2011

STR covered entities: Banks and non-bank financial institutions,
money remitters, securities and investment businesses, insurance, real
estate agents, dealers in precious metals and stones, trust or company
service providers, and legal entities

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: None in 2011

Convictions: None in 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: NO

With other governments/jurisdictions: NO

Nauru is a member of the Asia/Pacific Group on Money Laundering
(APG), a Financial Action Task Force (FATF)-style regional body. The APG
is undertaking a mutual evaluation on Nauru and completed an on-site
review in early November 2011. Once
finalized

, the mutual evaluation
report may be found here: http://www.apgml
.org/documents/default.aspx?DocumentCategoryID=17

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

In line with its National
Sustainable Development

 Strategy
2005-2025, the government has undertaken some major initiatives. These
include enacting and enforcing legislation to abolish offshore banks
used for money laundering by criminal syndicates.

In 2011, the Government of Nauru (GON) began work on a new Crimes
Act which is expected to be completed by 2013. The Crimes Act will cover
money laundering and corruption crimes. Concurrently, the GON’s
interagency working group that makes recommendations to the cabinet on
international agreements and obligations has prioritized the
ratification of UN conventions. Recommendations to the cabinet are
expected to be submitted in 2012 concerning the UN Convention against
Corruption and the 1988 UN Drug Convention. Nauru also should become a
party to the UN Convention against Transnational Organized Crime.

Nepal

Nepal is not a regional financial center. Government corruption,
poorly regulated trade, weak financial sector regulation, and a large
informal economy make the country vulnerable to money laundering and
terrorist financing. The major sources of laundered proceeds stem from
tax evasion, corruption, counterfeit currency, smuggling, and invoice
manipulation. Nepal has a large, unregulated, informal remittance
system, which is also vulnerable to money laundering and terrorist
finance.

For additional information focusing on terrorist financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: List approach

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, securities agents, insurance agents,
casinos, money remitters and changers, cooperatives, some government
agencies, lawyers and notaries, auditors, trust and company service
providers, and high value metals and stone traders

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: Over 200 from January to
October 2011

Number of CTRs received and time frame: Over one million from
January to October 2011

STR covered entities: Banks, securities agents, insurance agents,
casinos, money remitters and changers, cooperatives, some government
agencies, lawyers and notaries, real estate brokers, auditors, and high
value metals and stone traders

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Three from January to October 2011

Convictions: Two from January to October 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: NO

With other governments/jurisdictions: YES

Nepal is a member of the Asia/Pacific Group on Money Laundering
(APG), a Financial Action Task Force (FATF)-style regional body. Its
most recent mutual evaluation can be found here:
http://www.apgml.org/documents/docs/17/NEPAL%20ME2.pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Nepal has taken several steps to bring its laws into compliance
with international standards, including amending its AML/CFT laws to
improve enforcement. Nepal has developed an action plan to address
strategic deficiencies, including adequately criminalizing money
laundering and terrorist financing; implementing adequate procedures to
identify and freeze terrorist assets and
confiscate

 money laundering
assets; implementing appropriate mutual legal assistance legislation;
and improving the FIU and suspicious transaction reporting obligations.
However, lack of resources and enforcement capacity continue to present
significant anti-money laundering/counter-terrorist financing
challenges, as does low awareness of reporting requirements and
procedures.

On May 24, 2011, Parliament endorsed the Anti-Money Laundering Act
(First Amendment), which incorporates major amendments in the Asset
(Money) Laundering Prevention Act, as per the international AML
commitments made by the government of Nepal. However, the 2011
amendments still have broad deficiencies in the criminalization of money
laundering, including the coverage of predicate and ancillary offenses.
The Government of Nepal lacks human resource expertise and skills in the
responsible agencies, particularly in investigation techniques. Nepal
also lacks a comprehensive anti-terrorism law, complicating enforcement
efforts.

Coordination among the key government agencies is weak. The
Department of Revenue Investigation was responsible for money laundering
enforcement, but pursuant to the recent AML amendment, in June 2011
Nepal created a separate AML Investigation Department under the Ministry
of Finance to handle money laundering cases. The effectiveness of the
newly established department cannot yet be determined.

FIU officials have identified under- and over-invoicing as a major
money laundering challenge, and the recent discovery of a value added
tax (VAT)
scam

 highlights the widespread problem of tax evasion and
money laundering. The FIU is in the process of developing an e-reporting
system to help improve data collection, but the system will not be
functional for another one to two years. Nepal’s overall data
management system remains outdated, but improvements are being made,
especially in tax collection. Nepal should ensure disclosure protection
provisions and requirements to maintain records over time are part of
new regulations.

Despite these challenges, Nepal has taken a number of steps to
bring its legislation into compliance with international standards, such
as passing the national strategy on AML/CFT and amending the AML/CFT law
to include enhanced enforcement provisions. On March 31, 2011, Nepal
became a party to the UN Convention against Corruption. On December 23,
2011, Nepal became party to the UN Convention for the Suppression of the
Financing of Terrorism and to the UN Convention against Transnational
Organized Crime.

The FIU seeks greater cooperation with other countries, especially
in information sharing, and has applied for membership in the Egmont
Group. The FIU has signed memoranda of understanding with Bangladesh,
Malaysia, Mongolia,
Sri Lanka
  [Sinhalese,=resplendent land], formerly  ancient Taprobane, officially Democratic Socialist Republic of Sri Lanka, island republic (2005 est. pop.
, and Thailand.

Netherlands

The Netherlands is a major financial center and consequently an
attractive venue for laundering funds generated from illicit activities,
including activities often related to the sale of cocaine, cannabis, or
synthetic and
designer drugs

n.pl the synthetic organic compounds that are designed as analogs of illicit drugs and have the same narcotic or other dangerous effects.
, such as ecstasy. Financial fraud,
especially tax-evasion, is believed to generate a considerable portion
of domestic money laundering. There are a few indications of
syndicate-type structures in organized crime or money laundering, but
there is virtually no black market for smuggled goods in the
Netherlands. Although under the Schengen Accord there are no formal
controls on national borders within the European Union (EU), the Dutch
authorities run
special operations

 in the border areas with Germany and
Belgium to keep smuggling to a minimum.

Six
islands in the Caribbean

 fall under the jurisdiction of the
Netherlands. Bonaire, St. Eustasius, and Saba are special municipalities
of the country the Netherlands. Aruba, Curacao, and St. Maarten are
countries within the Kingdom of the Netherlands.

For additional information focusing on terrorist financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: NO

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
NO

KYC covered entities: Banks, credit institutions, securities and
investment institutions, providers of money transaction services, life
insurers and insurance brokers, credit card companies, casinos, traders
in high-value goods, other traders, accountants, lawyers and independent
legal consultants, business economic consultants, tax consultants, real
estate brokers, estate agents, civil-law notaries, trust and asset
administrative companies

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 117,000 in 2010

Number of CTRs received and time frame: 66,000 in 2010

STR covered entities: Banks, credit institutions, securities and
investment institutions, providers of money transaction services, life
insurers and insurance brokers, credit card companies, casinos, traders
in high-value goods, other traders, accountants, lawyers and independent
legal consultants, business economic consultants, tax consultants, real
estate brokers, estate agents, civil-law notaries, trust and asset
administrative companies

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: 1,300 in 2010

Convictions: 812 in 2010

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: YES

With other governments/jurisdictions: YES

The Netherlands is a member of the Financial Action Task Force
(FATF). Its most recent mutual evaluation can be found here:
http://www.fatf gafi.org/document/50/0,3746,en_32250379_32236963_47221490_1_1_1_1,00.html

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

In June 2008, the Netherlands Court of Audit published its
investigation of the Government of the Netherland’s policy for
combating money laundering and terrorist financing. The report
criticizes the Ministries of Interior, Finance, and Justice for: lack of
information sharing among them; too little use of asset seizure powers;
limited financial crime expertise and capacity within law enforcement;
and light supervision of notaries, lawyers, and accountants. Similar
deficiencies were seen during the more recent mutual evaluation of the
Netherlands. The ministries agreed in large part with these conclusions
and have taken steps to address them, including hiring financial crime
experts in law enforcement and introducing
new laws
 see Las Casas, Bartolomé de.
 to strengthen the
ability of law enforcement to tackle money laundering.

The Netherlands has established an “unusual transaction”
reporting system. Designated entities are required to file unusual
transaction reports (UTRs) with the FIU on any transaction that appears
unusual (applying a broader standard than “suspicious”) or
when there is reason to believe that a transaction is connected with
money laundering or terrorist financing. The FIU investigates UTRs and
forwards them to law enforcement for criminal investigation; once the
FIU forwards the report, the report is then classified as a STR. Draft
legislation is pending to strengthen the reporting regime and enact
stronger KYC rules.

In response to criticisms concerning the operational independence
and effectiveness of the Dutch financial intelligence unit (FIU), a
discussion on how to ensure FIU operational independence is underway.
The FIU is currently part of the police, which itself is undergoing
reforms.

In September 2011 the Dutch parliament passed a bill modernizing
the supervision of notaries. Comprehensive supervision will be conducted
by an independent supervisory body with investigative powers, with the
use of
confidential information

 about clients strictly limited to action
against notaries. A similar legislative proposal is being prepared
concerning the supervision of lawyers and is expected to be introduced
in parliament in 2012.

The United States enjoys strong cooperation with the Netherlands in
fighting international crime, including money laundering. One provision
included in the U.S.-EU mutual legal assistance agreement, which the
Netherlands has ratified, will facilitate the exchange of information on
bank accounts. The Dutch Ministry of Security and Justice and the
National Police work together with U.S. law enforcement authorities in
the Netherlands on operational money laundering initiatives.

Due to legal and political changes, asset seizure has become a
priority in money laundering cases. The assignment of dedicated money
laundering prosecutors is bringing change to historically low asset
seizure rates. A
Steering Committee

n.
A committee that sets agendas and schedules of business, as for a legislative body or other assemblage.


Noun
 has been created to discuss and
assign cases to the appropriate investigative unit. To further increase
the confiscation of criminal assets, the Dutch Minister of Security and
Justice introduced a new law including confiscation as a standard
procedure of any money-driven criminal case, aimed at increasing law
enforcement agencies’ capacity to take such action.

A Rotterdam Court sentenced seven people in February 2011 for
involvement in international drug trafficking and money laundering. The
main suspect was sentenced to three years and nine months, and [euro]4.5
million (approximately $5.927 million) cash was forfeited. The convicted
group had direct connections with Colombian drug cartels. In April 2011,
a court in The Hague sentenced a Dutch man to six years and four months
for money laundering, blackmailing, violent robbery, and other serious
crimes. Eleven other people in the same case received sentences of from
30 months to five years.

New Zealand
 , island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland.
 

New Zealand is not a major regional or offshore financial center.
Money laundering cases are infrequent in New Zealand. However,
authorities note that it is difficult to estimate the extent of money
laundering activities, since every serious crime that generates proceeds
could lead to a money laundering offense. Money laundering generally
occurs through the financial system, but the purchase of real estate and
other high value assets as well as the use of foreign exchange dealers
have become increasingly popular methods of laundering money. Narcotics
proceeds (mostly from
methamphetamine
 : see amphetamine; methedrine.
 and cannabis sales) and
fraud-associated activity (primarily Internet-banking fraud) are the
primary sources of illicit funds. International organized criminal
elements, mostly from Asia, are known to operate in New Zealand, but not
to a wide extent. New Zealand is a low threat environment for terrorist
finance.

New Zealand has a small number of casinos, which operate gaming
machines and a variety of table games.

For additional information focusing on terrorist financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: Combined approach

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, exchange offices, and money service
businesses; credit card companies; mortgage lenders; casinos; securities
brokers/dealers; safekeeping providers; asset and individual or
collective portfolio managers; and, life insurance or other investment
related insurance

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 4,357 in 2010

Number of CTRs received and time frame: Not available

STR covered entities: Banks, exchange offices, and money service
businesses; credit card companies; mortgage lenders; casinos; securities
brokers/dealers; safekeeping providers; asset and individual or
collective portfolio managers; and, life insurance or other investment
related insurance

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: 156 in 2009

Convictions: 55 in 2009

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: YES

With other governments/jurisdictions: YES

New Zealand is a member of the Financial Action Task Force (FATF)
and the Asia/Pacific Group on Money Laundering (APG), a FATF-style
regional body. Its most recent mutual evaluation can be found here:
http://www.fatf- gafi.org/document/28/0,3746,en_32250379_32236963_43998044_1_1_1_1,00.html

The Government of New Zealand (
GONZ

) is actively taking measures to
comply with international standards and strengthening its ability to
detect and deter money laundering and terrorist financing. New
Zealand’s Anti-Money Laundering/Counter-Terrorist Financing Act of
2009 sets reporting requirements for financial service providers and
casinos and establishes a risk-based approach to tracking potential
money laundering and terrorism financing activities. However, while the
Act is in force, the Ministry of Justice is still finalizing
regulations, and enforcement will not begin until 2013, in part to give
covered entities more time to accommodate the changes. The New Zealand
FIU anticipates an increase in reporting in 2014, and has hired
additional personnel to manage the workload.

The GONZ is considering proposed amendments to the Companies Act,
which will address the vulnerabilities created by foreign-owned shell
companies.

New Zealand and the United States do not require a bilateral
mutual
legal assistance treaty

 (MLAT) to enter into a mutual assistance
relationship. The United States has been designated as a
“prescribed foreign country” in New Zealand’s Mutual
Assistance in Criminal Matters Act 1992, enabling New Zealand to process
requests for assistance from the United States on a reciprocal basis. In
practice, New Zealand and U.S. authorities have a good record of
cooperation and information sharing in this area. New Zealand regularly
cooperates in international money laundering and terrorist financing
initiatives and investigations.

Nicaragua

The Republic of Nicaragua is not considered a regional financial
center. It continues to be a strategic
transshipment

 route for South
American cocaine and heroin destined for the United States and cash
returning to South America. Because of these activities,
Nicaragua’s financial system is highly vulnerable to money
laundering. Money laundering is primarily related to proceeds from
illegal narcotics and
political corruption

. Reportedly, the narcotics
trade is increasingly linked
to arms

 trafficking.

Nicaragua’s geography–with access to both the Atlantic and
Pacific Oceans, large inland lakes, porous border crossings, and
sparsely
populated
  
tr.v. pop·u·lat·ed, pop·u·lat·ing, pop·u·lates
1. To supply with inhabitants, as by colonization; people.

2.
 and
underdeveloped

adj.
Not adequately or normally developed; immature.
 Atlantic Coast region–makes it an
ideal haven for
transnational organized crime

 groups, including human
and drug trafficking organizations. The Central America Four Agreement
among
El Salvador
 , officially Republic of El Salvador, republic (2005 est. pop. 6,705,000), 8,260 sq mi (21,393 sq km), Central America.
, Guatemala, Honduras, and Nicaragua allows for free
movement of the citizens of these countries across their respective
borders without passing through
immigration
 entrance of a person (an alien) into a new country for the purpose of establishing permanent residence. Motives for immigration, like those for migration generally, are often economic, although religious or political factors may be very important.
 or customs inspection.
Consequently, the agreement represents a vulnerability to each country
for the cross-border movement of contraband and illicit proceeds of
crime.

As of March 2011, a total of 148 companies operated in 34
designated free trade zones (FTZs). The National Free Trade Zone
Commission (CNZF), a government agency, regulates all FTZs and the
companies operating in them. The Nicaraguan Customs Agency monitors all
FTZ imports and exports. It is suspected that money laundering occurs
via traditional mechanisms such as legal businesses; however, some
evidence exists of informal “cash and carry” networks for
delivering remittances from abroad that may be indicative of money
laundering There have been no convictions for money laundering in either
sector.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, credit unions, financial companies,
credit institutions, stock exchange systems, insurance companies,
savings and loan cooperatives, brokerage firms, money exchangers,
casinos, non-profit organizations, and pawn shops

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 368 in 2010

Number of CTRs received and time frame: Not available

STR covered entities: Banks, credit unions, financial companies,
credit institutions, stock exchange systems, savings and loan
cooperatives, brokerage firms, money exchangers, casinos, non-profit
organizations, and pawn shops

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: 17 in 2011

Convictions: Three in 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: YES

With other governments/jurisdictions: YES

Nicaragua is a member of the Caribbean Financial Action Task Force
(CFATF), a Financial Action Task Force (FATF)-style regional body. Its
most recent mutual evaluation can be found here:
http://www.cfatfgafic.org/downloadables/mer/Nicaragua 3rd Round MER
(Final) English.pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Statutes enacted to criminalize money laundering and terrorist
financing lack sufficient implementation due to weak enforcement
mechanisms and a corrupt judicial system. There have been cases when
money laundering/drug trafficking sentences were reduced or dismissed by
appellate judges under suspicious circumstances. Further, legislation
against organized crime has many enforcement deficiencies that should be
improved by the Nicaraguan National Assembly.

While the law grants the Financial Analysis Committee (
CAF

) the
ability to monitor other financial institutions, the CAF does not have
the resources or the power to enforce regulations.

Niger

Niger is not a regional financial center, and its banking sector is

rudimentary
 /ru·di·men·ta·ry/ ()
1. imperfectly developed.

2. vestigial.


adj.
1.
. It is a member of the Central Bank of West African States
(
BCEAO
 
), and shares its central bank and currency with other countries
in the region. High transaction costs deter businesses from placing
large amounts of cash in the banking system. Most economic activity
takes place in the informal financial sector.

Money laundering and financial crimes are commonplace in Niger. The
country is primarily a transit country for funds related to the
trafficking of narcotics and other forms of contraband. Niger is one of
the poorest and least developed countries in the world and is not a
significant source of criminal proceeds. Since 2008, kidnapping for
ransom has become a preferred fundraising method for terrorist groups.

For additional information focusing on terrorism financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: NO

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Public Treasury and State Savings Deposit
institutions; BCEAO; banks, microfinance institutions, and money
exchanges; insurance companies and brokers; securities exchanges or
brokers; post office; mutual funds and fixed capital investment
companies; lawyers; asset or fund custodians; management and
intermediation firms; business brokers for financial entities, auditors,
and real estate agents; sellers of valuable items such as fine arts or
precious stones; funds carriers; owners or managers of casinos; travel
agencies; and NGOs

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: One in 2010

Number of CTRs received and time frame: None

STR covered entities: Public Treasury and State Savings Deposit
institutions; BCEAO; banks, microfinance institutions, and money
exchanges; insurance companies and brokers; securities exchanges or
brokers; post office; mutual funds and fixed capital investment
companies; lawyers; asset or fund custodians; management and
intermediation firms; business brokers for financial entities, auditors,
and real estate agents; sellers of valuable items such as fine arts or
precious stones; fund carriers; owners or managers of casinos; travel
agencies; and NGOs

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Two in 2007

Convictions: One in 2008

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: NO

With other governments/jurisdictions: YES

Niger is a member of the Inter Governmental Action Group against
Money Laundering in West Africa (GIABA), a Financial Action Task Force
(FATF)-style regional body. Its most recent mutual evaluation can be
found at: http://www.giaba.org/index.php?type=c&id=48&mod=2&men=3

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Niger’s money laundering and terrorist financing laws are not
in full compliance with international standards. Although addressed in
the AML/CFT laws, customer due diligence procedures for designated
non-financial businesses and professions have not been implemented.

Niger participates in international law enforcement cooperation,
mutual legal assistance, and asset sharing groups within the region.

The National Center for the Treatment of Financial Information
(CENTIF) is Niger’s FIU. Only two of the eight reports of
suspicious activities received since CENTIF’s 2004 creation
resulted in legal action, leading to one conviction. CENTIF has suffered
numerous setbacks, including a fire in 2010. It has had to move
locations twice and is still in rented quarters. Since October 2011,
under the transition government of President Salou Djibo, CENTIF has
been headed by a new director who plans to reshape the organization,
including by building capacity and securing Government of Niger funding
for an appropriate building.

In July 2011, former President Issoufou named an eight-member High
Authority to Combat Corruption that will work closely with CENTIF to
investigate suspicious activities. In August, the Ministry of Justice
installed an anti-corruption hotline.

Nigeria

Nigeria remains a major drug trans-shipment point and a significant
center for criminal financial activity. Individuals and criminal and
terrorist organizations take advantage of the country’s location,
porous borders, weak laws, corruption, lack of enforcement, and poor
socio-economic conditions to
launder

 the proceeds of crime. The proceeds
of illicit drugs in Nigeria derive largely from foreign criminal
activity rather than domestic activities. One of the schemes used by
drug traffickers to
repatriate

To bring home assets that are currently held in a foreign country. Domestic corporations are frequently taxed on the profits that they repatriate, a factor inducing the firms to leave overseas the profits earned there.
 and launder their proceeds involves the
importation of various commodities, predominantly luxury cars and other
items such as textiles, computers, and mobile telephone units. Drug
traffickers reportedly also use Nigerian financial institutions for
currency transactions involving U.S. dollars derived from illicit drugs.

Proceeds from drug trafficking, illegal oil
bunkering
  
n.
The act or process of supplying a ship with fuel.
, bribery and
embezzlement, contraband smuggling, theft, and financial crimes, such as
bank fraud, real estate fraud, and identity theft, constitute major
sources of illicit proceeds in Nigeria.
Advance fee fraud

, also known as
“419 fraud” in reference to the fraud section in
Nigeria’s criminal code, remains a lucrative financial crime that
generates hundreds of millions of illicit dollars annually. Money
laundering in Nigeria takes many forms, including: investment in real
estate; wire transfers to offshore banks; political party financing;
deposits in foreign bank accounts; use of professional services, such as
lawyers, accountants, and investment advisers; and cash smuggling.
Nigerian criminal enterprises adeptly devise ways to subvert
international and domestic law enforcement efforts and
evade
  
v. e·vad·ed, e·vad·ing, e·vades

v.tr.
1. To escape or avoid by cleverness or deceit:

2.
a.
 detection.

Nigeria’s AML/CFT progress in 2011 relative to its action plan
was not considered sufficient by the Financial Action Task Force (FATF),
which highlighted Nigeria’s lack of adequate progress by adding
Nigeria to its October 2011 Public Statement.

For additional information focusing on terrorist financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: YES

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: List approach

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, investment and securities
dealers/brokers, and discount houses; insurance institutions; debt

factorization
  
tr.v. fac·tor·ized, fac·tor·iz·ing, fac·tor·iz·es Mathematics
To factor.


fac
 and conversion firms, bureau de change, and finance
companies; money brokerage firms whose principal business includes
factoring,
project financing

,
equipment leasing

, debt administration,
fund management, private ledger service, investment management, local
purchase order financing, export finance, project consultancy, financial
consultancy, or pension funds management; dealers in jewelry, cars and
luxury goods; chartered accountants, audit firms, and tax consultants;
clearing and settlement companies and legal practitioners; hotels,
casinos, and supermarkets

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 2,306 from October 1,
2010-September 30, 2011

Number of CTRs received and time frame: 11,580,836 from October 1,
2010-September 30, 2011

STR covered entities: Banks, investment and securities
dealers/brokers, and discount houses; insurance institutions; debt
factorization and conversion firms, bureau de change, and finance
companies; money brokerage firms whose principal business includes
factoring, project financing, equipment leasing, debt administration,
fund management, private ledger service, investment management, local
purchase order financing, export finance, project consultancy, financial
consultancy, or pension funds management; dealers in jewelry, cars and
luxury goods; chartered accountants, audit firms, and tax consultants;
clearing and settlement companies and legal practitioners; hotels,
casinos, and supermarkets

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: 639 from October 1, 2010-September 30, 2011

Convictions: 73 from October 1, 2010-September 30, 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: YES

With other governments/jurisdiction: YES

Nigeria is a member of the Inter Governmental Action Group against
Money Laundering in West Africa (GIABA), a FATF-style regional body. Its
most recent mutual evaluation can be found here:
http://www.giaba.org/index.php?type=c&id=49&mod=2&men=2

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Nigerian authorities should work toward full implementation of a
regime capable of
thwarting
  
tr.v. thwart·ed, thwart·ing, thwarts
1. To prevent the occurrence, realization, or attainment of:

2.
 money laundering and terrorist financing. In
2011, Nigeria enacted a new Money Laundering (Prohibition) Act (
MLPA

MLPA Multiplex Ligation-dependent Probe Amplification
MLPA Multi-Lateral Peering Agreement
MLPA Minimum Legal Purchase Age
MLPA Moon Lake Property Association
),
which introduces the concept of corporate criminal liability
(“offenses of a body corporate”), and a new Terrorism
(Prevention) Act (
TPA

), which includes some new provisions on terrorist
financing and the freezing and seizure of assets. The Government of
Nigeria (GON) should ensure its anti-money laundering legislation
comports with international standards and covers all the recommended
predicate offenses, including terrorist financing. Currently, terrorist
financing is not listed as a predicate offense for money laundering. The
new TPA represents progress toward criminalizing terrorist financing,
but it may not do so consistent with international standards. The GON
should amend the law
as needed
 prn. See prn order.
 to bring it into compliance.

Weak law enforcement and justice sector issues have hindered the
progress of and
thwarted
  
tr.v. thwart·ed, thwart·ing, thwarts
1. To prevent the occurrence, realization, or attainment of:

2.
 many prosecutions and investigations. The GON
should ensure the autonomy and independence of the
Economic and
Financial Crimes Commission

 (EFCC) and the Nigerian Financial
Intelligence Unit (NFIU) from political pressures. The GON also should
strengthen its supervision of designated non-financial businesses and
professions. Moreover, the GON should ensure the range of agencies that
pursue money laundering cases, including the EFCC, Nigerian Drug
Law
Enforcement Agency

, Independent Corrupt Practices and Other Related
Offences Commission, Nigerian Agency for the Prevention of Trafficking
in Persons, and National Police Force have the capacity to function as
investigative partners in financial crimes cases, as well as work to
eradicate any corruption existing within law enforcement bodies. The
National Assembly should amend the 2011 MLPA to provide for increased
autonomy of the NFIU and adopt safe harbor provisions to protect STR
reporting entities. The GON should consider developing a
cadre

 of
specially trained judges with dedicated portfolios in order to handle
financial crime cases effectively, and the National Assembly also should
adopt a non-conviction based
asset forfeiture

 bill.

Niue

Niue is not a regional financial center and has no free trade
zones. Niue is a self-governing democracy, operating in free association
with New Zealand. The Government of Niue (GON) relies heavily on New
Zealand to assist with external and economic affairs. The country has
experienced a significant decline in population, largely from the

emigration
 see immigration; migration.
 of its population to New Zealand.

In recent years Niue has tightened its legislation and formed a
financial intelligence unit (FIU) to comply with international standards
against money laundering and terrorist financing.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: Not available

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Financial institutions;
safe deposit box

,
trust and company service providers, and individual funds trustees;
insurers and insurance intermediaries; securities dealers, futures
brokers, money exchangers and remitters; issuers, sellers, or
redeemers

 of travelers checks, money orders, or similar instruments; payroll and
payroll funds delivery businesses; dealers in precious metals and
stones; real estate agents; casinos and gambling houses (including
internet gaming); lawyers, notaries, and accountants engaged in real
estate, client financial management, and the creation, operation and
management of companies; and legal persons and arrangements

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: None

Number of CTRs received and time frame: One in 2011

STR covered entities: Financial institutions; safe deposit box,
trust and company service providers, and individual funds trustees;
insurers and insurance intermediaries; securities dealers, futures
brokers, money exchangers and remitters; issuers, sellers, or redeemers
of travelers checks, money orders, or similar instruments; payroll and
payroll funds delivery businesses; dealers in precious metals and
stones; real estate agents; casinos and gambling houses (including
internet gaming); lawyers, notaries, and accountants engaged in real
estate, client financial management, and the creation, operation and
management of companies; and legal persons and arrangements

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: None

Convictions: None

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: NO

With other governments/jurisdictions: YES

Niue is a member of the Asia/Pacific Group on Money Laundering
(APG), a Financial Action Task Force (FATF)-style regional body. A copy
of its most recent evaluation is not available. The next mutual
evaluation is scheduled for late 2011.

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

The Niue FIU exchanges financial intelligence related to money
laundering and financing of terrorism with the New Zealand FIU. The Niue
Crown Law office reports it has received a small number of cash
transaction reports. However, it is not apparent that any prosecutions
or asset seizures have occurred under its anti-money
laundering/counter-terrorist financing (AML/CFT) legislation.

Niue is not a member of the United Nations. It generally complies
with international AML/CFT standards, and AML/CFT legislation includes
the 2004 United Nations Sanctions Regulations (Terrorism Suppression and
Afghanistan Measures).

Norway

Although it is a high income country, Norway is not considered a
regional financial center. Norway’s significance in terms of money
laundering is low. There are illicit proceeds related to narcotics sales
and production, prostitution, robberies, smuggling, and white collar
crimes like embezzlement, tax evasion and fraud. Criminal proceeds
laundered in the jurisdiction derive primarily from domestic criminal
activity, often by foreign criminal gangs or guest workers who in turn

remit

 the proceeds home.

For additional information focusing on terrorist financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All crimes approach

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, the Central Bank, finance companies,
e-money institutions, pension funds, postal operators, auditors, asset
managers, securities dealers, credit agents, money exchangers, insurance
companies, accountants, lawyers, notaries, auction houses, realtors,
money transporters, holding houses, and dealers in autos and high value
goods

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 6,660 in 2010

Number of CTRs received and time frame: 3,734 in 2010

STR covered entities: Banks, the Central Bank, finance companies,
e-money institutions, pension funds, postal operators, auditors, asset
managers, securities dealers, credit agents, money exchangers, insurance
companies, accountants, lawyers, notaries, auction houses, realtors,
money transporters, holding houses, and dealers in autos and high value
goods

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Not available

Convictions: Not available

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: YES

With other governments/jurisdictions: YES

Norway is a member of the Financial Action Task Force. Its most
recent mutual evaluation can be found here:
http://www.fatf-gafi.org/dataoecd/61/55/35535328.pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

The Norwegian financial intelligence unit (FIU) voices some concern
over the low number and poor quality of reports from certain entities
covered by the reporting obligation. Banks, auditors, insurance
companies and payment transfer entities maintain high levels of
reporting, while reports from other industries, such as dealers in cars
and other expensive items, are few and decreasing. Reporting from
attorneys is up, but is low compared to the high number of transactions
conducted by this sector. Given the overall transaction volume, the FIU
suspects considerable underreporting in these sectors. The FIU is
attempting to improve the quality of STR reporting by providing specific
guidance and follow up to obligated entities. In 2010, the FIU reported
122 incidents to the National Police Intelligence System and submitted
23 formal complaints and reports to be used in criminal cases. Although
aggregate data is not available, the number of money laundering
prosecutions and convictions is believed to be low given the size of the
Norwegian economy.

In addition to Norway’s large currency transaction reporting
requirement a purpose declaration is required for currency transactions
over
NOK

 100,000 (approximately $17,900).

Norwegian police agencies share responsibility for identifying,
tracing, freezing, seizing, and
forfeiting

 narcotics and terrorist
financing related assets. As a general rule, the police may seize direct
proceeds from criminal acts. Norwegian law also allows for seizing
instruments of crime, but a relationship to the crime must be proven.
Norwegian law allows both criminal and civil forfeiture.

Oman

Oman is not a regional or offshore financial center and does not
have significant money laundering or terrorist financing concerns. Due
to its location on the tip of the
Strait of Hormuz

, Oman is home to a
small number of smugglers operating between Musandam, the northern-most

exclave
 /ex·clave/ () a detached part of an organ.


n.
An outlying, detached portion of a gland or other part, as of the thyroid or pancreas; an accessory gland.
 of Oman, and Iran. Omani authorities are aware that growing
Iranian overtures toward Oman for increased trade and engagement may
create conditions for AML/CFT concerns. Trade is generally financed in
small amounts of cash and features mainly consumer goods. There is no
indication this activity is tied to terrorist financing. There is also a
small amount of narcotics trafficking in Oman, although the government
is proactive in tracking and prosecuting drug traffickers. Sources of
illegal proceeds are generally small and derived from smuggling or drug
trafficking activities. Smugglers are generally Iranian while drugs are
trafficked by Omani citizens. Oman-based hawaladars that have been
involved with illicit transfers for terrorist financing purposes have
been closed down by Omani authorities. Corruption, primarily in the form
of
cronyism

Tammany Hall

Manhattan Democratic political circle notorious for spoils system approach. [Am. Hist.: Jameson, 492]
 or insider operations, remains a concern.

Money laundering is centered in the formal financial system, rather
than in the port free zones or informal sector. In 2011 the
Central Bank
of Oman

 licensed
Islamic Banking
 Islamic banking refers to a system of banking or banking activity that is consistent with Islamic law (Sharia) principles and guided by Islamic economics.
. There is no offshore financial center
in Oman.

For additional information focusing on terrorist financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: NO Domestic:
NO

KYC covered entities: Banks; foreign exchange companies; investment
and credit companies; insurance companies; companies and individuals
providing financial services; stock and securities brokers; real estate
brokers; dealers in precious metals and stones;
notary

 publics; lawyers
and accountants

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: Not available

Number of CTRs received and time frame: Not available

STR covered entities: Banks; foreign exchange companies; investment
and credit companies; insurance companies; companies and individuals
providing financial services; stock and securities brokers; real estate
brokers; dealers in precious metals and stones; notary publics; lawyers
and accountants

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Not available

Convictions: Not available

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: NO Other mechanism: NO

With other governments/jurisdictions: YES

Oman is a member of the Middle East and North Africa Financial
Action Task Force (MENAFATF), a Financial Action Task Force (FATF)-style
regional body. Its most recent mutual evaluation can be found here:
http://www.menafatf.org

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

The Government of Oman (GOO) has been improving its AML/CFT regime,
beginning with a 2010 overhaul of its legislation. To implement the 2010
law, Oman has retooled its legal, regulatory and enforcement mechanisms.
In response to corruption issues, the government empowered the State
Audit office with greater investigatory power.

Currently Oman’s financial intelligence unit (FIU), located
within the Royal Oman Police, receives few STRs from non-bank entities.
In practice, about 95% of STRs are received from banks, mostly foreign.
The FIU does not have access to daily transaction flows via the Central
Bank database. The FIU recognizes its lack of capacity in forensic
analysis, compromising its ability to analyze financial data and
seriously pursue AML cases. The Omani government openly discusses its
AML/CFT enforcement efforts, although it does not publish information
regarding suspicious transactions and criminal prosecutions. The
Financial Investigations Unit in the Royal Oman Police is the
responsible entity for enforcing AML/CFT laws and regulations, and law
enforcement authorities generally respond to requests for assistance
from foreign counterparts.

Under the 2010 AML/CFT law, Oman introduced a declaration system
for bulk cash, bearer
negotiable

 financial instruments, and precious
metals and stones, requiring all amounts over
OMR

 6,000 (approximately
$15,600) or its equivalent to be declared to the authorities. However,
Omani authorities, from the FIU to law enforcement, have no central
database; more than 70 databases currently receive and analyze different
data sets with no connectivity.

Oman issued Royal Decree 104/2011 on October 23, 2011 ratifying the
International Convention for the Suppression of the Financing of
Terrorism; Oman became a party to this convention on November 10, 2011.

To enhance their operational capabilities, the Omani authorities
should
hasten
  
v. has·tened, has·ten·ing, has·tens

v.intr.
To move or act swiftly.

v.tr.
1. To cause to hurry.

2.
 efforts to
finalize
  
tr.v. fi·nal·ized, fi·nal·iz·ing, fi·nal·iz·es
To put into final form; complete or conclude:
 steps aimed at empowering the FIU and
law enforcement authorities. These authorities should undertake training
to improve analytical and investigatory capacity. The FIU should perform
outreach to non-bank financial institutions to improve reporting from
the non-bank sectors. It is critical that the GOO enhance and integrate
its databases to ensure access by the Omani interagency authorities to
the information stored in them. The GOO also should require enhanced due
diligence procedures for politically exposed persons, and collect and
publish statistics indicating numbers of STRs, prosecutions,
investigations and convictions in line with international standards. The
GOO should ratify the UN Convention against Corruption.

Pakistan

Pakistan continues to suffer from financial crimes related to
narcotics trafficking, terrorism, smuggling, tax evasion, corruption,
counterfeit goods and fraud. Pakistani criminal networks play a central
role in the transshipment of narcotics and smuggled goods from
Afghanistan to international markets. The abuse of the charitable
sector, trade-based money laundering, money exchange companies,
hawala/hundi, and bulk cash smuggling are common methods used to launder
money in Pakistan and the region. Pakistan’s real estate sector is
also a popular destination for illicit funds, as many real estate
transactions are poorly documented. Pakistan does not have firm control
of its borders with Afghanistan, Iran or China, which facilitates the
flow of smuggled goods to and from the
Federally Administered Tribal
Areas

 and Baluchistan.

Money laundering often occurs in Pakistan in both the formal and
informal systems. Fraudulent invoicing is typical in hawala/hundi
counter-valuation schemes. Legitimate remittances from Pakistani
expatriates residing abroad flow through the formal banking sector,
licensed money exchange businesses, and hawalas. Since the start of the
calendar year through October remittances totaled $14 billion, and since
March have averaged roughly $1 billion per month. The authorities do not
provide an estimate of remittances that flowed through informal
channels.

Pakistan was first publicly identified by the Financial Action Task
Force (FATF) in February 2008 for deficiencies in its anti-money
laundering/counter terrorist financing (AML/CFT) regime. While Pakistan
has taken some steps to improve its AML regime, the FATF continues to
note Pakistan’s failure to adequately implement its action plan and
correct AML/CFT deficiencies, particularly its terrorism finance law.

For additional information focusing on terrorism financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state. gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: YES

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: List approach

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: YES Domestic:
YES

KYC covered entities: Banks, agricultural credit institutions,
money exchangers, accountants, notaries, gaming centers, auto dealers
and securities dealers

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 535 from July 2010 to May
31, 2011

Number of CTRs received and time frame: 138 from January 2009
through December 2010

STR covered entities: Banks, agricultural credit institutions,
money exchangers, notaries, gaming centers, and securities dealers

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Four from January 2009 to October 2010

Convictions: None in 2010

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: NO

With other governments/jurisdictions: YES

Pakistan is a member of the Asia/Pacific Group on Money Laundering
(APG), a Financial Action Task Force (FATF)-style regional body. Its
most recent mutual evaluation can be found here: http://www.apgml.org/
documents/docs/17/Pakistan%20MER%20-%20final%20version.pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

To gain more oversight of the informal money transfer sector, the

State Bank of Pakistan

 (
SBP
 Spontaneous bacterial peritonitis, see there
) requires all money exchange companies to
obtain licenses and meet minimum
capital requirements

. As a result, it
is illegal for money exchange companies, referred to as hawala/hundi, to
operate without a license; however, few hawalas have been registered by
the authorities, and unlicensed hawaladars continue to operate illegally
throughout Pakistan (particularly in Peshawar and Karachi). While the
SBP has implemented the licensing of all money exchange companies and
hawalas, the enforcement environment is not commensurate with SBP’s
regulations. Shortcomings in the enforcement of the regulations,
particularly in the movement of cash, makes Pakistan’s informal
financial sector consistently vulnerable to abuse by illicit actors.

Pakistan continues to have serious deficiencies in its AML regime.
To address these it must: remove remaining inadequacies with regard to
the criminalization of money laundering; demonstrate effective
regulation of money service providers, including an appropriate
sanctions regime and increasing the range of ML preventive measures for
these services; and improve and implement effective controls for
cross-border cash transactions. Pakistan needs to demonstrate that not
only does it have AML laws on the books, but that these laws are
enforced. To date, Pakistan has a poor track record. Between January
2009 and October 2010 there have been only four prosecutions and zero
convictions under the AML law due to limited resources and lack of
capacity.

Palau

Palau is not a regional or offshore financial center. The primary
sources of illegal proceeds are illegal
drugs and prostitution

.
Corruption in the governmental sector includes the misuse of government
funds and cronyism, in part due to Palau’s small size and extensive
family networks. Palau is a low-risk jurisdiction for organized crime
and terrorist financing.

Palau has one free trade zone, the Ngardmau Free Trade Zone (
NFTZ
 
).
A public corporation, Ngardmau Free Trade Zone Authority, oversees the
development of the NFTZ and issues licenses for businesses to operate
there. NFTZ licensing exempts businesses from Foreign Investment Act
requirements and certain import and export taxes. To date, no
development has taken place within the area designated for the free
trade zone and the NFTZ directors continue to search for developers and
investors.

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: All serious crimes

Legal persons covered: criminally: YES civilly: YES

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: NO Domestic:
NO

KYC covered entities: Banks, credit unions, and money remitters

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: Not available

Number of CTRs received and time frame: Not available

STR covered entities: Banks, credit unions, money remitters, and
non-governmental organizations

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Three from 2006 through 2011

Convictions: Three from January through December 2011

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: YES

With other governments/jurisdictions: YES

Palau is a member of the Asia/Pacific Group on Money Laundering
(APG), a Financial Action Task Force (FATF)-style regional body. Its
most recent mutual evaluation can be found here:
http://www.apgml.org/documents/docs/17/Palau%202008.pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

The Money Laundering Prevention and Control Act (
MLPCA

), amended in
2007, does not include all predicate crimes prescribed in the
international standards and currently lacks implementing regulations.
Nor does it cover the designated non-financial businesses and
professions operating in Palau. Significant deficiencies remain in the
areas of customer due diligence, record keeping, monitoring of
transactions, and supervision. The Financial Institutions Commission is
the AML/CFT supervisor, but it does not have the resources to ensure
AML/CFT compliance nor to issue any regulations.

The Palau Financial Intelligence Unit (FIU) is responsible for
receiving and analyzing STRs, along with tracing, seizing, and freezing
assets, but lacks a dedicated budget and staff. The Government of Palau
(GOP), with donor assistance, organized a multi-agency STR review team
to review the reports and help identify and initiate investigations. The
multi-agency approach has enabled the FIU to function given its
limitations of manpower and funding, and has fostered information
sharing and joint investigations among the relevant law enforcement
agencies. It is not, however, a long-term solution, and the GOP should
dedicate funds and permanent staff to the FIU.

The Cash Courier Disclosure Act has been used successfully by Palau
Customs and Security to make bulk cash currency seizures at the airport.
The GOP should extend its excellent monitoring of the airport to all its
border points of entry and exit to protect against the smuggling of bulk
cash, narcotics and other contraband.

Palau’s Counter-Terrorism Act specifically addresses its
obligation under UN Security Council Resolution 1373. However, it does
not adequately address provisional measures of seizing of evidence and
property and the freezing of capital and financial transactions related
to the financing of terrorism. Palau should strengthen its ability to
freeze and confiscate assets related to the financing of terrorism. The
GOP should circulate the UNSCR 1267 Sanctions Committee’s
consolidated list of terrorist entities. Palau should also become a
party to the 1988 UN Drug Convention, the UN Convention against
Corruption, and the UN Convention against Transnational Organized Crime.

Panama

Panama’s strategic geographic location and status as a
regional financial center make it an attractive jurisdiction for money
launderers. Panama’s success in establishing itself as a regional
business and logistics hub, based on the success of its ports, airport
and the Colon Free Zone–the second largest free trade zone in the
world–have enhanced its attractiveness for organizations engaged in
illicit financial activities. Money laundering in Panama is believed to
be primarily related to the laundering of the proceeds of drug
trafficking, and the country sits along major drug trafficking routes.
The work of launderers is facilitated by weaknesses in the regulatory
framework, notably the existence of
bearer share

 corporations, but more
importantly by uneven enforcement of anti-money laundering measures and
the weak judicial system, which is susceptible to corruption and
favoritism.

After negotiating and signing 13 Double Taxation Treaties with
OECD
 see Organization for Economic Cooperation and Development.
 members, and ratifying the Tax Information Exchange Agreement with the
United States in 2010, Panama achieved removal from the OECD’s gray
list of tax havens in July 2011.

For additional information focusing on terrorist financing, please
refer to the Department of State’s Country Reports on Terrorism,
which can be found here: http://www.state.gov/j/ct/rls/crt/

DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED
TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS
OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR THAT
OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: YES

CRIMINALIZATION OF MONEY LAUNDERING:

“All serious crimes” approach or “list”
approach to predicate crimes: List approach

Legal persons covered: criminally: YES civilly: NO

KNOW-YOUR-CUSTOMER (KYC) RULES:

Enhanced due diligence procedures for PEPs: Foreign: NO Domestic:
NO

KYC covered entities: Banks, savings cooperatives, savings and
mortgage banks, and money exchanges; investment houses and brokerage
firms; insurance and reinsurance companies; fiduciaries; casinos; free
trade zone companies; finance companies; real estate brokers; and
lawyers

SUSPICIOUS TRANSACTION REPORTING (STR) REQUIREMENTS:

Number of STRs received and time frame: 563 in 2010

Number of CTRs received and time frame: 495,546 in 2010

STR covered entities: Banks, cooperatives, and money exchanges;
casinos; fiduciaries; insurance companies; government entities focused
on the lottery: and investment houses

MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:

Prosecutions: Not available

Convictions: 22 in 2010

RECORDS EXCHANGE MECHANISM:

With U.S.: MLAT: YES Other mechanism: YES

With other governments/jurisdictions: YES

Panama is a member of the Financial Action Task Force on Money
Laundering in South America (GAFISUD), a Financial Action Task Force
(FATF)-style regional body. Its most recent mutual evaluation can be
found here: http://www.cfatf
gafic.org/downloadables/mer/Panama_3rd_Round_MER_(Final)_English.pdf

ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:

Panama cooperates well with U.S. law enforcement agencies. However,
the notable successes the Government of Panama (GOP) has had in
interdicting flows of illegal drugs have not been matched by similar
success in addressing money laundering concerns. The various government
agencies tasked with addressing money laundering remain fractured and
under-resourced, and communicate poorly with one another. Panama’s
financial intelligence unit, the UAF, in particular, lacks the resources
to process and investigate, let alone enforce, reporting requirements on
suspicious transactions. The judicial branch’s capacity to
successfully try and
convict

 money launderers remains weak, and judges
remain susceptible to corruption. Although the GOP took a step forward
with the introduction of know-your-client legislation requiring lawyers
to conduct due diligence into the beneficial owners of the companies
they incorporate, the continued existence of bearer shares corporations
remains a vulnerability of the anti-money laundering regulatory
framework.

Panama, through its Customs Authority, is taking steps to reduce
the use of Tocumen Airport as an artery for cash couriers to move cash
into Panama. More targeted enforcement action, in collaboration with
U.S. law enforcement agencies, has led to increased scrutiny of
passengers and notable seizures of undeclared cash at the airport.

Customs also has been effective in disrupting trade-based money
laundering through the partnership of the Panamanian and U.S. trade
transparency units (
TTU

TTU Tennessee Technological University
TTU Tallinn Technical University
TTU Tennessee Temple University  
). Established in 2010 by U.S. Immigration and
Customs Enforcement and Panama’s Customs authority, the Panamanian
TTU has had significant success. Despite these advances, Customs lacks
sufficient resources to fulfill its mandate.

The Colon Free Trade Zone (
CFZ

CFZ Canucks Fan Zone  
) continues to be vulnerable to abuse
by criminal groups through illicit financial activities, due primarily
to insufficient enforcement of existing controls. The new electronic
transaction recording information system, when fully implemented, will
improve capacity to trace transactions. Bulk cash is relatively easily
introduced into the country by declaring it is for use in the CFZ. A new
resolution, published December 14, 2011, improves the AML/CFT framework
in the CFZ. The resolution has 25 articles that
supersede

 and include
all the provisions of law 42 of 2000 and Decree JD-008 of 2008. It will
enter into force 60 days after publication. Among the items addressed
are the requirement to have a compliance officer in each company;
implementation of preventative measures, supervision, inspection and
sanctions; STR and
CTR

 reporting; and know your customer policies.

During 2011, the GOP took steps to continue to improve the
legislative framework governing anti-money laundering and financial
sector transparency. In 2011, Panama passed legislation (Law 2 of 2011)
requiring lawyers to know their clients, conduct due diligence on the
beneficial ownership of corporations they establish and share that
information with the authorities upon request. These steps have
strengthened Panama’s regulatory framework. Panama also is drafting
new anti-money laundering legislation, which would strengthen the
UAF’s authority and increase the number of sectors required to
report suspicious transactions.

If the GOP continues its efforts to improve its anti-money
laundering legal framework, particularly eliminating bearer shares,
criminalizing “tipping off,” improving the strength of the
prosecutor’s office and the judicial system, and creating a more
transparent financial network, money laundering will become more
difficult within Panama’s borders.