Financial Crime World

Title: Dutch Caribbean Islands - Aruba, Curaçao, and St. Maarten - Named as Money Laundering Countries in US Report

US Department of State Releases 2017 International Narcotics Control Strategy Report

In their latest International Narcotics Control Strategy Report, the United States (US) Department of State has identified some countries as Major Money Laundering Countries for the year 2016. Among these, the Dutch Caribbean islands of Aruba, Curaçao, and St. Maarten find themselves listed.

Weak Governments - A Recurring Issue

The US report highlights weaknesses in the governments of these countries, rendering them susceptible to money laundering activities.

Money laundering activities in St. Maarten predominantly revolve around:

  1. Criminal profits derived from international tax shelters
  2. Business investments

The US government severely criticized the island’s government, tagging it as “weak” and continued to be vulnerable to integrity-related crimes.

Aruba: A Transhipment Point for Drugs

Aruba, situated between North and South America, acts as a transhipment point for drugs from South America destined for the US and Europe. Conversely, large amounts of currency flow in the opposite direction. Bulk cash smuggling is a concern due to Aruba’s strategic location. Principal money laundering activities reportedly occur through:

  1. Real estate purchases
  2. International tax shelters
  3. Wire transfers
  4. Cash transport between Aruba, the Netherlands, and other Dutch Caribbean islands.

Curaçao: Money Laundering and Illicit Narcotics

The largest portion of money laundering in Curaçao is tied to proceeds from illegal narcotics. Criminal organizations take advantage of:

  1. The availability of US dollars
  2. Offshore banking and incorporation systems

They utilize these resources to launder their profits via:

  1. Real estate purchases
  2. International tax shelters
  3. Wire transfers
  4. Cash transport.

Implications for the Dutch Caribbean Islands

These allegations add an extra burden to the already fragile economies and reputations of the Dutch Caribbean islands.

It remains to be seen how the governments of Aruba, Curaçao, and St. Maarten will respond to the US report and address the money laundering concerns raised within the international community.