Financial Crime World

COSTA RICA: CROSS BORDER MONEY LAUNDERING EXPOSED

What is the Scale of the Problem?

Costa Rica has been identified as a key player in cross-border money laundering, with the country’s banks and financial institutions accused of turning a blind eye to illicit transactions. According to recent estimates, Costa Rica is one of the top 10 countries in the world for money laundering, with billions of dollars flowing through the country’s banking system each year.

How Do Foreign Investors Get Caught Up?

Foreign investors in Costa Rica may inadvertently get caught up in cross-border money laundering schemes if they fail to properly vet their business partners or ignore suspicious transactions. In some cases, foreign investors have even been accused of actively participating in money laundering operations.

Risks for Foreign Investors:

  • Failure to conduct thorough due diligence on business partners
  • Ignoring suspicious transactions
  • Inadequate financial record-keeping

What Regulatory Authorities Are Involved?

The Superintendencia General de Seguros de Costa Rica (SUGESE) and the Superintendencia del Mercado de Valores (SMV) are the two main regulatory bodies responsible for investigating and enforcing anti-money laundering laws in Costa Rica. These agencies have significant powers to investigate, fine, and even revoke licenses of companies found guilty of money laundering.

What Penalties Can Foreign Investors Face?

Foreign investors who get caught up in cross-border money laundering schemes can face severe penalties, including fines, imprisonment, and even extradition to countries where the money laundering occurred. In some cases, foreign investors may also be required to forfeit assets linked to the money laundering operation.

Potential Consequences:

  • Fines
  • Imprisonment
  • Extradition
  • Forfeiture of assets

How Can Foreign Investors Protect Themselves?

To avoid getting caught up in cross-border money laundering schemes, foreign investors should take a number of precautions, including conducting thorough due diligence on business partners, reporting suspicious transactions to regulatory authorities, and maintaining accurate financial records. By taking these steps, foreign investors can minimize their risk of being involved in money laundering operations and protect themselves from serious penalties.

Best Practices:

  • Conduct thorough due diligence on business partners
  • Report suspicious transactions to regulatory authorities
  • Maintain accurate financial records