NAURU’S FINANCIAL SECRETS LIFTED: BLACKLISTED BANKS STILL OPERATING DESPITE US SANCTIONS

The International Criminal Court’s Financial Investigation Bureau (FIB) has issued a warning that several blacklisted Nauru-registered banks are still in operation, despite being designated a money laundering concern by the United States Department of the Treasury in 2002.

Background

In 2002, the US Department of the Treasury prohibited financial dealings between US financial institutions and any Nauru-licensed institution due to concerns over the island nation’s lack of effective banking supervision and its failure to criminalize money laundering. This designation was made as part of the USA Patriot Act, which aimed to address concerns over offshore banking and money laundering.

FIB’s Concerns

According to FIB Assistant Director Jon Merrett, some of these blacklisted banks have re-emerged and are attempting to disguise their origins. These banks may have similar names to credible banks, making it easy for financial institutions to fall into a trap. The FIB is concerned that some US financial institutions may be unwittingly trading with or maintaining correspondent relationships with blacklisted Nauru financial institutions.

What You Can Do

To avoid confusion and reduce the risk of compromising compliance obligations, the FIB is urging concerned financial institutions to contact them for clarification on the status of a particular bank or financial institution. The FIB has catalogued a complete list of all Nauru banks and financial institutions named by the US Department of the Treasury and can offer protective measures such as tracking assets and exiting correspondent relationships.

How to Take Advantage of this Service

To take advantage of this service, financial institutions are advised to email fib@icc-ccs.org for full details on how to proceed.

Conclusion

The FIB’s warning highlights the importance of due diligence when dealing with foreign banks and financial institutions. By staying informed and taking proactive steps, financial institutions can reduce their risk of involvement with blacklisted entities and maintain compliance with regulatory requirements.