Financial Crime World

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Dominican Republic Faces Scrutiny Over Banking Compliance Procedures

The Financial Action Task Force (FATF) has recently evaluated the Dominican Republic’s anti-money laundering and combating terrorist financing (AML/CFT) measures, revealing both progress and areas for improvement.

Progress Made

While there is still work to be done, the FATF evaluation highlights significant strides made by the Dominican Republic in implementing AML/CFT policies. The organization assesses a country’s ability to prevent the misuse of financial systems for illicit purposes.

Compliance Ratings

According to the FATF evaluation, the Dominican Republic has achieved “largely compliant” or “partially compliant” ratings in most areas, with some exceptions:

  • R.1 - Assessing risk and applying a risk-based approach: The country is considered “largely compliant”.
  • R.2 - National cooperation and coordination: The country is deemed “compliant”.
  • R.3 - Money laundering offense: The Dominican Republic has made significant progress in this area, achieving a “compliant” rating.
  • R.10 - Customer due diligence: The country is considered “largely compliant”.
  • R.20 - Reporting of suspicious transactions: The Dominican Republic has achieved a “compliant” rating.

Areas for Improvement

However, the FATF evaluation also highlights several areas where the Dominican Republic needs to improve its banking compliance procedures:

  • R.4 - Confiscation and provisional measures: The country is considered “partially compliant”.
  • R.5 - Terrorist financing offense: The Dominican Republic has made progress in this area, but still requires improvement.
  • R.13 - Correspondent banking: The country is deemed “partially compliant”.
  • R.26 - Regulation and supervision of financial institutions: The Dominican Republic needs to strengthen its oversight of financial institutions.

Recommendations

The FATF evaluation recommends that the Dominican Republic take several steps to improve its banking compliance procedures, including:

  • Enhancing customer due diligence and monitoring
  • Strengthening regulations and supervision of financial institutions
  • Improving the confiscation and provisional measures framework

By implementing these recommendations, the Dominican Republic can further strengthen its AML/CFT framework and reduce the risk of money laundering and terrorist financing in its financial system.