Belize faces sanctions for “money laundering and terrorist financing”

The February 2011 report and recommendations from the European Fisheries Control Agency on illegal, unreported and unregulated fishing is not the only document being ignored by the Barrow Administration. The BELIZE TIMES has discovered that Belize faces possible sanctions for falling in non-compliance with recommendations by the Caribbean Financial Action Task Force (CFATF) on ongoing money laundering and terrorist financing activities since July 2011.

A report published by the CFATF on May 30th, 2013 declares that if Belize does not take specific steps to correct identified deficiencies by November 2013, the agency will lobby for measures against Belize that could further cripple the economy.

In a 212-page July 2011 assessment carried out by CFATF on Belize’s control and enforcement of laws on Anti-Money Laundering and Combating the Financing of Terrorism in Belize, a detailed plan of action with identified target dates areas that needed corrective action was included.

However, Belize has not measured up to expectations. The recent May 30th reports declares, “If Belize does not take specific steps by November 2013, then the CFATF will take the additional steps of calling upon its Members to consider implementing counter measures to protect their financial systems from the ongoing money laundering and terrorist financing risks emanating from Belize, and at that time CFATF will consider referring Belize to the Financial Action Task Force International Cooperation Review Group (FATF ICRG).”

In the July 2011 report, CFATF indicates that “the highest risk of money laundering [in Belize] is from drug trafficking”. While criminalized under the Money Laundering and Terrorism Prevention Act, 2008, the full gambit of the law, under the Vienna Convention, is not being applied. For example, the report cited that Belize’s law does not consider illicit the “manufacture, transport or distribution of certain substances” such as Pseudoephedrine. Additionally, certain categories of offences for money laundering are not criminalized and the offence of theft has a minimum property value for criminalization. The report also highlights that while money laundering is against the law, the rate of convictions “demonstrates ineffective implementation”.

The Financial Intelligence Unit investigates financial crimes in Belize, but CFATF says the FIU is inadequately outfitted to carry out its work.

“The operational independence of the FIU is vulnerable to external influence and the resources of the FIU are inadequate to allow it to effectively carry out its functions,” declared CFATF’s report, “The FIU’s office space is inadequate and the present IT configuration does not provide adequate security”.

The report also cites that the FIU lacks the legal teeth to conduct its work without depending other agencies such as the Police Department, which has its own level of challenges. “There are no measures that provide for the postponing and waiving of an arrest or seizure of money for the purpose of identifying persons or gathering evidence during the course of an investigation…there are no written provisions granting the FIU powers to take witness statements for use in investigations and prosecutions…”

The report also looks at terrorist financing and how Belize’s laws deal with that crime. While terrorist financing has been criminalized, the report says certain vital areas of that criminal activity are not covered by the law. For example, ancillary terrorist financing offences committed in another jurisdiction are not covered by the law. Another area not dealt with is the freezing mechanism for property jointly owned or controlled directly or indirectly by terrorists, those who finance terrorism or terrorist organizations or property derived or generated from funds or other assets owned or controlled directly or indirectly by terrorists, those who finance terrorism or terrorist organizations.

The report also calls on transparency for casinos. It calls for a law to require for information on persons behind the corporate shareholders of applicants for licences for gaming facilities. Additionally, says the report, there is no adequate provision to prevent criminals or their associates from holding or being the beneficial owner of a significant or controlling interest or holding a management function in or being an operator under licences for gaming premises and the use of gaming machines.

The Belize Times