NAURU’S BLACKLISTED BANKS RE-SURFACE, FINANCIAL INVESTIGATION BUREAU WARNS OF MONEY LAUNDERING RISK
A Warning from the International Criminal Court’s Financial Investigation Bureau
The International Criminal Court’s Financial Investigation Bureau (FIB) has sounded the alarm over several Nauru-registered banks that are still operating despite being blacklisted by the US Department of the Treasury in 2002. These banks pose a significant money laundering risk to financial institutions worldwide.
Background
In 2001, the USA Patriot Act was introduced, targeting over 400 offshore banks with no physical or legal residence. The Act aimed to address concerns about banking supervision on islands where money laundering was not a criminal offence and where customer identification records were not required.
Prohibition and Consequences
As a result of the USA Patriot Act, all US financial institutions are disallowed from opening or maintaining accounts for foreign financial institutions involved with Nauru or any institution licensed by the country, except for the Bank of Nauru which also serves as the Central Bank. This prohibition was enacted to prevent the re-emergence of blacklisted banks.
Blacklisted Banks Re-Surface
Despite being blacklisted, some Nauru-registered banks are attempting to disguise their origins in an effort to deceive financial institutions into doing business with them. The FIB warns that this can lead to unwittingly trading with or maintaining correspondent relationships with blacklisted Nauru financial institutions.
Verification and Protective Measures
To avoid confusion and reduce the risk of inadvertently compromising compliance obligations, the FIB recommends that financial institutions take steps to verify the identity of their counterparts. The Bureau has catalogued a complete list of all Nauru banks and financial institutions named by the US Department of the Treasury.
In instances where banks find themselves dealing with one of the blacklisted financial institutions, the FIB can offer protective measures including tracking assets and helping to exit correspondent relationships. Financial institutions are advised to contact the FIB for clarification and to take advantage of these services:
- Email: fib@icc-ccs.org
- Phone: [insert phone number]
- Website: [insert website]
Conclusion
The re-emergence of blacklisted Nauru banks poses a significant money laundering risk to financial institutions worldwide. It is crucial for financial institutions to verify the identity of their counterparts and take steps to prevent unwittingly doing business with these blacklisted institutions. The FIB is committed to helping financial institutions navigate this complex issue and ensure compliance with regulatory requirements.