Financial Crime World

Ecuador Toughens Stance on Financial Crime Whistleblowing with New Laws

In an effort to tackle corruption and financial crimes, Ecuador has introduced new laws that increase penalties for those found guilty of such offenses. The amendments to the country’s comprehensive organic criminal code provide protection for whistleblowers who come forward with information about these crimes.

Key Provisions:

  • Individuals convicted of corruption-related crimes face stiffer penalties, including longer prison terms and fines.
  • Active and passive bribery is now punishable by imprisonment ranging from five to seven years.
  • Civil servants who embezzle public funds can receive sentences between five and 13 years.

Confiscation of Assets Linked to Financial Crimes

The law introduces a new provision that allows authorities to confiscate property not directly related to the crime if it is deemed necessary to repair damage caused. This is seen as a significant step in recovering assets linked to financial crimes.

Corporate Accountability

  • Companies found guilty of corruption-related offenses can face dissolution or liquidation, and fines ranging from 500 to 1,000 times the minimum monthly salary.
  • Organizations that comply with certain conditions may be able to mitigate these penalties, including self-disclosure before an investigation begins, cooperation with authorities, compensation for damages caused by the crime, and having a compliance program in place.

Protection for Whistleblowers

The new law provides protection for whistleblowers who come forward with information about financial crimes. It obliges natural persons to report such crimes and guarantees their personal data confidentiality. Whistleblowers are entitled to a reward ranging from 10% to 20% of the value of confiscated property if their information leads to such confiscation.

Key Players in the Fight Against Corruption

The Office of the Comptroller General of Ecuador (CGE) has been formalized as a key player in the fight against corruption, with expanded functions including detecting contract overpricing and submitting reports on indicators of crimes to the Attorney General’s Office.