Financial Crime World

Ecuador’s Fight Against Financial Crime: A Progress Report

The Financial Action Task Force (FATF), an international organization that sets standards for combating money laundering and terrorist financing, has released its Mutual Evaluation Report on Ecuador. The report assesses the country’s progress in implementing key recommendations to prevent financial crime.

Risk Assessment and Cooperation

  • Ecuador has largely implemented the necessary measures to assess risks and apply a risk-based approach (R.1). However, its national cooperation and coordination mechanisms (R.2) need improvement.

  • Key Findings:

    • Ecuador’s laws on money laundering offences are compliant with international standards
    • Confiscation and provisional measures require further development

Terrorist Financing Offences

  • Ecuador has largely implemented the necessary measures to combat terrorist financing offences (R.5), including targeted financial sanctions related to terrorism and terrorist financing (R.6).

Non-Profit Organisations and Financial Institution Secrecy Laws

  • The country’s laws on non-profit organisations (R.8) and financial institution secrecy (R.9) require improvement.

Customer Due Diligence and Record Keeping

  • Ecuador has largely implemented the necessary measures to ensure customer due diligence (R.10) and record keeping (R.11).

Politically Exposed Persons, Correspondent Banking, and Wire Transfers

  • The country’s laws on politically exposed persons (R.12), correspondent banking (R.13), and wire transfers (R.16) require improvement.

Internal Controls and Foreign Branches and Subsidiaries

  • Ecuador has largely implemented the necessary measures to ensure internal controls (R.18) in its financial institutions, including foreign branches and subsidiaries.

Reporting of Suspicious Transactions and Tipping-Off and Confidentiality

  • The country’s laws on reporting suspicious transactions (R.20) and tipping-off and confidentiality (R.21) are compliant with international standards.

DNFBPs: Customer Due Diligence and Other Measures

  • Ecuador has largely implemented the necessary measures to ensure customer due diligence (R.22) in designated non-financial businesses and professions (DNFBPs).
  • The country’s laws on transparency and beneficial ownership of legal persons (R.24) and arrangements (R.25) require improvement.

Regulation and Supervision of Financial Institutions and DNFBPs

  • Ecuador has largely implemented the necessary measures to regulate and supervise financial institutions (R.26) and DNFBPs (R.28).

Financial Intelligence Units, Law Enforcement, and International Cooperation

  • The country’s laws on financial intelligence units (R.29), law enforcement powers (R.30 and R.31), and international cooperation (R.37-40) are compliant with international standards.

Ecuador has made significant progress in implementing key recommendations to prevent financial crime. However, some areas require further attention and improvement to meet international standards. The country should continue to work on addressing these gaps to ensure a stronger fight against money laundering and terrorist financing.