Financial Crime World

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BANKING COMPLIANCE PROCEDURES IN GUATEMALA RAISE EYEBROWS AMONG LOCAL AND FOREIGN INVESTORS

Resilient Economy, Concerns Beneath the Surface

Guatemala’s banking and financial system has been making headlines lately, with major credit rating agencies upgrading the country’s rating following the COVID-19 pandemic. The resilient economy, long-standing macroeconomic stability, and cautious fiscal and monetary policies have contributed to this positive shift.

However, beneath the surface, there are concerns about banking compliance procedures in Guatemala.

Efforts to Prevent Asset Laundering and Financing of Terrorism

The Guatemalan Financial Intelligence Unit (UFG) has been working tirelessly to prevent asset laundering and financing of terrorism through its Special Verification Intendancy (IVE). The UFG’s efforts have led to a significant increase in financial institutions’ compliance with regulations, but some experts warn that more needs to be done to ensure the system remains transparent and secure.

Areas of Concern

“The Guatemalan banking system has made progress in recent years, but there are still areas of concern,” said Maria Rodriguez, a banking expert at Mayora & Mayora. “Compliance procedures need to be strengthened to prevent illicit activities and maintain investor confidence.”

  • Complacency in Compliance Procedures
  • Lack of Transparency in Financial Transactions
  • Limited Oversight and Supervision

Challenges Ahead

The Guatemalan banking system comprises 18 banks, 11 financial companies, and other institutions that are subject to oversight from the Banking Superintendence (SIB). The SIB is responsible for supervising compliance with laws and regulations, including anti-money laundering and counter-terrorism financing. Despite these efforts, some investors remain cautious about doing business in Guatemala due to concerns about the country’s civil and commercial justice system.

Improving Civil and Commercial Justice System

Recent amendments to the Code of Civil and Commercial Procedure aim to enhance the efficiency of the courts by allowing electronic filing, but more needs to be done to improve response times and reduce recovery risks. To address these concerns, Mayora & Mayora has established a Banking and Finance Practice Group comprising professionals with vast experience in both the private and public sector.

Support for Clients

The group offers clients comprehensive support for:

  • Structuring contracts
  • Secured transactions
  • Compliance with local banking regulations
  • Navigating potential limitations and delays for recovery