Dominica Falls Short on Anti-Money Laundering and Terrorist Financing Efforts

A recent evaluation by international authorities has highlighted several shortcomings in Dominica’s efforts to combat money laundering (ML) and terrorist financing (TF). This article will delve into the findings of the evaluation and identify areas that require improvement.

Strategic Analysis

While the Financial Intelligence Unit (FIU) of Dominica demonstrates a strong capacity for strategic analysis, its output is not commensurate with the country’s risk profile. The number of disseminations from the Analytical Department, which triggers ML investigations, can be improved.

• The FIU’s strong capacity for strategic analysis is commendable.
• However, the lack of output in proportion to Dominica’s risk profile is a concern.

Proactive Approach

The country’s approach to identifying and prosecuting ML cases is largely reactive rather than proactive, with a lack of prioritization within the judicial system. This has resulted in a low conviction rate for ML cases.

• The reactive approach to ML cases hinders effective prosecution.
• Prioritization within the judicial system is essential for improving conviction rates.

Confiscation of Criminal Proceeds

Dominica’s confiscation of criminal proceeds is not being effectively enforced, with a low proportion of non-declared or falsely declared cash or bulk cash transactions being confiscated.

• The lack of effective enforcement of confiscation policies undermines efforts to combat ML.
• Improvements are needed to ensure that criminal proceeds are properly seized and confiscated.

Terrorist Financing

In terms of TF, while Dominica has a strong legal framework, its risk assessment was deemed incomplete and did not consider several vulnerabilities. No TF cases have been prosecuted in the period under review, and the country lacks a national TF policy.

• The lack of a comprehensive risk assessment for TF hinders effective prevention.
• A national TF policy is essential for guiding efforts to combat TF.

Implementation of UN Security Council Resolutions

The Financial Services Unit (FSU) has implemented some measures to comply with UN Security Council resolutions 1267 and 1373, but its procedures are deficient and lack guidance for regulated entities on their obligations.

• The implementation of UN Security Council resolutions is commendable.
• However, the deficiencies in procedures and lack of guidance hinder effective compliance.

Targeted Approaches

Substantial work remains to be done in implementing targeted approaches, outreach, and oversight of non-profit organizations (NPOs), which were not assessed in the country’s risk assessment.

• Targeted approaches are essential for effectively combating ML and TF.
• Outreach and oversight of NPOs is critical for ensuring that these organizations do not facilitate illegal activities.

Conclusion

While Dominica has made some progress in combating ML and TF, significant improvements are needed to bring its efforts up to par with international standards. Addressing the shortcomings identified in this evaluation will be essential for strengthening the country’s anti-money laundering and terrorist financing regime.