Financial Crime World

Assessment of Dominica’s Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) Regime

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AML Findings

Lack of Proactive Approach

  • React instead of act: Dominica takes a reactive rather than proactive approach to identifying money laundering (ML).
  • Insufficient ML investigations: The number of ML investigations, prosecutions, and convictions is not commensurate with Dominica’s risk profile.
  • Low conviction rate: ML cases are not prioritized within the judicial system, which hampers successful prosecution.
  • Confiscation of proceeds: While there is a sound legal framework for freezing, seizing, and confiscating criminal proceeds, it is not being effectively enforced.

CTF Findings

  • Criminalization of TF: Dominica has a strong legal framework for the criminalization of terrorist financing (TF).
  • Limited TF prosecutions: Authorities have not prosecuted any TF cases in the period under review.
  • Lack of targeted approach: The National Risk Assessment (NRA) did not consider several TF vulnerabilities, including cross-border wire transfers, non-profit organizations (NPOs), and legal persons.
  • Insufficient training and professional development: CAs lack a national CFT policy that would continuously assess the TF threat, identify requirements for training and professional development.

TF-SF Findings

Nascent Regime

  • Developing TFS-TF regime: Dominica’s TFS-TF regime is still developing, with recent amendments to the SFTA addressing designations, procedures, and mechanisms governing TFS-TF.
  • Lack of guidance: The FSU has not issued guidance on TFS obligations for financial institutions (FIs) or designated non-financial businesses and professions (DNFBPs).
  • Insufficient training: Specific training has not been provided by the FSU in relation to TF risks and vulnerabilities in NPOs.

Conclusion

While Dominica has made progress in establishing a legal framework for AML/CTF, there are still significant challenges to be addressed. These include enforcing confiscation of proceeds, improving ML investigations and prosecutions, and addressing TF risks through targeted approaches, training, and professional development.