Financial Action Task Force (FATF) Assessment of Dominica’s Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) Regime
Introduction
The Financial Action Task Force (FATF) has conducted an assessment of Dominica’s AML/CFT regime, highlighting key findings and areas for improvement. This report summarizes the main points and recommendations from the assessment.
Money Laundering (ML)
Dominica has a sound legal framework for ML, but its implementation is not sufficient.
- Reactive approach: The country takes a reactive approach to identifying ML cases, rather than proactive.
- Effectiveness of investigations and prosecutions: There are concerns about the effectiveness of ML investigations and prosecutions, particularly in complex cases involving professional networks and cash smuggling.
Terrorist Financing (TF)
Dominica has a strong legal framework for TF, but its NRA did not consider several TF vulnerabilities.
- Risk assessment: The country deemed the risk of TF to be “low,” but this assessment was not exhaustive.
- Prosecution of TF cases: Authorities have not prosecuted any cases relating to TF in the period under review.
Terrorist Financing Sanctions (TFS)
Dominica has updated its legal framework required by UNSCR 1267 and 1373, but the Central Authority procedures are deficient.
- Freeze without delay mechanism: The freeze without delay mechanism is also inadequate.
- Training on TF risks: Regulated entities have demonstrated awareness of TFS requirements, but specific training on TF risks and vulnerabilities in Non-Profit Organizations (NPOs) has not been provided.
Confiscation of Proceeds
Dominica has a sound legal framework for confiscating proceeds of crimes, but its implementation is limited.
- Declaration system: The country’s declaration system for cross-border movements of cash or BNIs is not being effectively enforced.
Areas for Improvement
Based on the FATF assessment, Dominica needs to improve its AML/CFT regime in the following areas:
- Strengthening ML investigation and prosecution capacity
- Conducting a comprehensive review of TF vulnerabilities, particularly in NPOs
- Improving TFS regime, including the freeze without delay mechanism
- Enhancing confiscation of proceeds framework
The FATF report provides recommendations for Dominica to address these areas and improve its AML/CFT regime.