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Financial Crimes Pose Major Challenges to Banks in Guadeloupe: Experts Highlight Need for Strengthened Anti-Money Laundering Strategies

Guadeloupe’s financial institutions are facing significant challenges in preventing financial crime, according to a recent report by leading governance, risk, and compliance consulting firm fscom. The report highlights key issues in anti-money laundering (AML) strategies that have been identified, emphasizing the need for strengthened AML compliance programmes.

The Financial Crime Compliance Report 2023: Key Findings

The Financial Crime Compliance Report 2023, compiled by manager Richard Dunlop, provides a comprehensive analysis of the AML frameworks of 60 firms in Guadeloupe that require further review and enhancement. The report sheds light on the major challenges faced by financial institutions in preventing financial crime, including deficiencies in AML compliance programmes.

Top Areas of Concern

The top areas of concern identified in the report include:

• Compliance Monitoring: Many firms’ compliance monitoring plans are not fit for purpose and do not provide adequate assurance into the effectiveness of their controls.
• Customer Risk Assessment: The country risk assessment within the holistic customer risk assessment fails to adequately consider and risk rate high-risk third countries (HR3Cs).
• Transaction Monitoring: Firms’ TM rulesets are not of sufficient quality, and on various occasions, the rulesets implemented by firms were deemed insufficient.
• Customer Due Diligence: The firm had not captured key CDD information, including a variety of key customer information.
• Enhanced Due Diligence: Firms’ country risk assessments have led to EDD measures not being applied as required.

Common Issues Detected

The report also highlights common issues detected across these areas, including:

• Inadequate compliance monitoring plans that do not provide adequate assurance into the effectiveness of controls
• Failure to adequately consider and risk rate high-risk third countries (HR3Cs)
• Insufficient quality of TM rulesets, leading to inadequate detection of suspicious transactions
• Failure to capture key CDD information, including a variety of key customer information
• Deficiencies in country risk assessments that have led to EDD measures not being applied as required

Recommendations for Financial Institutions

The report emphasizes the need for financial institutions in Guadeloupe to strengthen their AML compliance programmes and address these deficiencies. The guidance from the report will be invaluable for financial institutions looking to prevent financial crime and ensure compliance with regulations.

“We urge financial institutions in Guadeloupe to take note of the findings and recommendations outlined in this report,” said Philip Creed, director and head of financial crime at fscom. “Each firm faces its own distinctive set of hurdles, but these common weaknesses are risks that all firms operating in the financial services sector should have on their radar.”