Aruba’s Fight Against Money Laundering and Terrorism Financing: Progress Made, But Room for Improvement

Introduction

Oranjestad, Aruba - The Caribbean Financial Action Task Force (CFATF) has released its latest Mutual Evaluation Report on Aruba’s efforts to combat money laundering and terrorism financing. The report highlights both the strengths and weaknesses of Aruba’s AML/CFT regime.

Economy and Money Laundering Risks

Aruba’s economy is primarily based on tourism, which makes it vulnerable to money laundering risks. The country’s 2021 Money Laundering Risk Assessment identified various proceeds-generating crimes, including:

Drug trafficking
Bulk cash smuggling
Bribery and corruption
Fraud
Underground banking
Organized crime
Human trafficking
Migrant smuggling

Progress Made

The report praises Aruba’s efforts to strengthen its AML/CFT regime, citing legislative amendments and effective institutional policies and procedures. The country has implemented an AML/CFT framework that has shown to be effective in some instances, achieving satisfactory results in areas such as:

Understanding risk
Domestic cooperation
Coordination

The report also commends Aruba’s Financial Intelligence Unit (FIU) for utilizing financial intelligence and relevant information to identify targets, conduct investigations, and confiscate proceeds.

Areas for Improvement

However, the report highlights several areas where improvement is needed:

Implementation of terrorist financing sanctions
Supervision of non-profit organizations
Money laundering investigations and prosecution
Transparency of legal persons and arrangements

Aruba has not conducted a risk assessment on virtual assets and service providers (VASPs), but authorities have not identified any such activities operating in the jurisdiction.

Conclusion

While progress has been made in strengthening Aruba’s AML/CFT regime, the report concludes that major and fundamental improvements are needed to ensure the country’s continued compliance with international standards.