Financial Crime World

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Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) in Dominica

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Money Laundering

Dominica’s AML framework has several areas for improvement. Some key points include:

  • Strategic Analysis: The Financial Intelligence Unit (FIU) conducts strategic analysis, but it does not sufficiently reflect all higher-risk areas identified in the National Risk Assessment (NRA).
  • Investigations and Prosecutions: Dominica has demonstrated instances of ML investigations and prosecutions, but the extent is not commensurate with its risk profile.
  • Reactive Approach: The jurisdiction takes a reactive approach to identifying ML and lacks prioritization of ML cases within the judicial system.

Confiscation of Proceeds

While there is a sound legal framework for freezing, seizing, and confiscating instrumentalities and proceeds of crimes, there are some areas that need improvement:

  • Declaration System: The declaration system for cross-border movements of cash or bank notes is not effectively enforced.
  • Confiscation Procedures: While the framework is in place, more work needs to be done to improve confiscation procedures.

Terrorist Financing (TF)

Dominica has a strong legal framework for criminalizing TF, but its NRA did not consider several TF vulnerabilities. Some key points include:

  • Prosecutions: Authorities have not prosecuted any cases relating to TF in the period under review.
  • Sanctions: The effectiveness, dissuasiveness, and proportionality of sanctions could not be assessed due to the lack of convictions.

Terrorist Financing (TF) Sanctions

While Dominica has updated its legal framework required by UNSCR 1267 and 1373, there are some areas that need improvement:

  • Central Authority Procedures: The Central Authority procedures are deficient.
  • Training for Regulated Entities: The FSU as primary supervisory authority has implemented training for regulated entities on TFS requirements, but specific guidance is lacking.

National Counter-Financing of Terrorism (CFT) Policy

Dominica lacks a national CFT policy that would continuously assess the TF threat and identify requirements for training and professional development of Competent Authorities (CAs). Some key points include:

  • National CFT Policy: A national CFT policy is essential to ensure the country’s AML/CFT framework is effective.
  • Training and Professional Development: The policy should also focus on providing training and professional development opportunities for CAs.

Overall Recommendations

Based on the report, Dominica needs to improve its AML/CFT framework in several areas, including:

  • Enhancing strategic analysis and prioritization of ML cases
  • Improving confiscation procedures and enforcement
  • Strengthening TF regulations and sanctions
  • Developing a national CFT policy
  • Implementing targeted outreach and oversight for non-profit organizations (NPOs)