INSRC | Country report volume II: Countries of primary concern – Curacao

Country report volume II: Countries of primary concern - Curacao

Country report volume II: Countries of primary concern – Curacao

Curacao is an autonomous country within the Kingdom of the Netherlands that defers to the Kingdom in matters of defense, foreign affairs, final judicial review, human rights, and good governance. Curacao is considered a regional financial center and, due to its location, it is a transshipment point for drugs from South America bound for the United States, the Caribbean, and Europe.

Money laundering is primarily related to proceeds from illegal narcotics. Money laundering organizations take advantage of the availability of U.S. dollars, banking secrecy, offshore banking and incorporation systems, two free trade zones (airport and harbor), an expansive shipping container terminal with the largest oil transshipment center in the Caribbean, and resort/casino complexes to place, layer, and launder illegal proceeds.

Money laundering occurs through real estate purchases and international tax shelters. Laundering activity also occurs through wire transfers and cash transport among Curacao, the Netherlands, and other Dutch Caribbean islands and illegal underground banking. Bulk cash smuggling is a continuing problem due to Curacao’s close proximity to South America.

Economic activity in the free zones continues to decline. Curacao’s active “e-zone” provides e-commerce investors a variety of tax saving opportunities and could be attractive to illegal activities.

The financial sector consists of company (trust) service providers, administrators, and self-administered investment institutions providing trust services and administrative services. These entities have international companies, mutual funds, and investment funds as their clients. Several international financial services companies relocated their businesses elsewhere because Curacao is fighting its perception of being a tax haven. Curacao continues to sign tax information exchange agreements (TIEAs) and double taxation agreements with other jurisdictions to prevent tax fraud, financing of terrorism, and money laundering.

Several casinos and internet gaming companies operate on the island, although the number of internet gaming companies is declining.

For additional information focusing on terrorist financing, please refer to the Department of State’s Country Reports on Terrorism, which can be found at: 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 U.S. currency; currency derived from illegal sales in the U.S.; or illegal drug sales 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

Are 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: Onshore and offshore banks, saving banks, money remitters, credit card companies, credit unions, life insurance companies and brokers, trust companies and other service providers, casinos, Customs, lawyers, notaries, accountants, tax advisors, jewelers, car dealers, real estate agents, and administration offices

REPORTING REQUIREMENTS:

Number of STRs received and time frame: 510: January 1 – November 1, 2015

Number of CTRs received and time frame: 7,852: January 1 – November 1, 2015

STR covered entities: Banks, saving banks and building societies, money remitters and exchangers, financial leasing companies, credit associations, credit card companies, credit unions, life insurance companies, insurance brokers, securities broker/dealers, trust and company service providers, casinos, Customs, lawyers, notaries, accountants, tax advisors, auditors, jewelers and dealers in luxury goods, pawn shops, car dealers, real estate agents, administration offices, the Central Bank of Curacao and Sint Maarten, financial advisors, lotteries, online betting lotteries, dealers in precious stones and metals, construction material dealers, superannuation/pension funds, and administrators of investment institutions and self-administered investment institutions and investors

money laundering criminal Prosecutions/convictions:

Prosecutions: 1 in 2014

Convictions: 0 in 2014

Records exchange mechanism:

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

With other governments/jurisdictions: YES

Curacao is a member of the Caribbean Financial Action Task Force (CFATF), a FATF-style regional body. Its most recent mutual evaluation can be found at: https://www.cfatf-gafic.org/index.php?option=com_docman&task=cat_view&gid=349&Itemid=418&lang=en

Enforcement and implementation issues and comments:

Dutch Kingdom government agencies continue to work together to combat organized crime in the Caribbean region. In 2014, local law enforcement authorities, together with their counterparts in the Netherlands, launched a three-year program intended to fight economic and financial crimes. This program has resulted in various seizures and arrests.

In March and November 2015, Curacao passed new legislation that addresses money laundering vulnerabilities in the money remittance and currency exchange sector. Also, the prescriptive list of indicators was removed and replaced by one category of subjective indicators that is flexible enough to allow reporting entities to submit what could be considered a suspicious or unusual transaction. This indicator is: transactions where there is a cause to presume they may be related to money laundering or terrorist financing.

The investigation into money laundering allegations against a now former member of the board of the Curacao Lottery Foundation, who also is a major lottery operator, is ongoing. The Government of Curacao’s cooperation with the U.S. government led to the freezing of over $30 million of the lottery operator’s assets in the United States. The lottery operator is reputedly a major financer of a political party in Curacao. Curacao’s gambling industry is allegedly intertwined with the mafia. A former prime minister and a current member of parliament are also on trial for alleged money laundering and associated crimes.

Curacao utilizes an “unusual transaction” reporting system. Pursuant to local legislation, the reporting entities file unusual transaction reports (UTRs) with the financial intelligence unit (FIU) and not suspicious transaction reports (STRs), as is the custom in common law legal systems. The FIU analyzes the UTR and determines if it should be classified as a STR. There were 17,169 UTRs filed in 2015, as of November 1. From January 1 – November 1, 2015, there were 667 disseminated referrals to law enforcement agencies. On May 1, 2015, a new head of the FIU was appointed.

A few years ago, Curacao achieved a major result by confiscating funds from a Venezuelan drug trafficker who laundered criminal proceeds via Puerto Rico. As a result, in August 2015, U.S. authorities shared $873,127.57 with Curacao, based on an asset sharing treaty. To amplify this success Curacao launched the “Confiscation and Asset Recovery Team Curacao.”

The mutual legal assistance treaty between the Kingdom of the Netherlands and the United States applies to Curacao. Additionally, Curacao has a TIEA with the United States.

Curacao is part of the Kingdom of the Netherlands and cannot sign or ratify international conventions in its own right. Rather, the Netherlands may arrange for the ratification of any convention to be extended to Curacao. The 1988 Drug Convention was extended to Curacao in 1999. In 2010, the UN Convention against Transnational Organized Crime was extended to Curacao, and the International Convention for the Suppression of the Financing of Terrorism was extended to the Netherlands Antilles, and as successor, to Curacao. The UN Convention against Corruption has not been extended to Curacao.

Curacao should continue its regulation and supervision of the offshore sector and free trade zones, investigate the underground banking phenomenon, and pursue money laundering investigations and prosecutions. The government should work to fully develop its capacity to investigate and prosecute money laundering and terrorism financing cases. Curacao also should continue to strengthen cooperation within the Kingdom, particularly among agencies such as the Public Prosecutors Office, Customs, Immigration, Revenue Services, Coast Guard, and the Royal Dutch Marechaussee (military police).

Bron: Report 2016 International Narcotics Control Strategy Report (INCSR)

Geef een reactie

Het e-mailadres wordt niet gepubliceerd. Vereiste velden zijn gemarkeerd met *