Financial Crime World

Cybercrime and Financial Institutions in Panama Struggle to Meet International Standards

Introduction

PANAMA CITY, JUNE 19, 2024 - Panama’s efforts to combat cybercrime and prevent the misuse of financial institutions have been under scrutiny by international standards-setters. The country’s anti-money laundering and combating the financing of terrorism (AML/CFT) regime has faced challenges in meeting international standards.

History of AML/CFT Deficiencies

  • In 2017, Panama’s AML/CFT regime was last assessed, identifying strategic deficiencies in preventing money laundering through legal persons and arrangements.
  • As a result, Panama was placed on the Financial Action Task Force’s (FATF) grey list in June 2019.
  • Despite exceeding its action plan deadlines in January 2021, Panama remained on the list until October 2023.

FATF Grey Listing Highlights Concerns

The FATF’s grey listing highlights concerns over Panama’s ability to prevent cybercrime and ensure that financial institutions are not being used for illicit activities. International experts have expressed skepticism about the country’s efforts to address these issues.

“Panama’s struggle to meet AML/CFT standards is a concern for the region,” said a FATF official. “The country must continue to work towards improving its regulatory framework and ensuring that financial institutions are transparent and accountable.”

Panama’s Response

In response, Panama has vowed to strengthen its AML/CFT regime and improve cooperation with international partners. The country will be closely monitored by the FATF and other international organizations.

Cybercrime: A Significant Threat to Global Financial Stability

As cybercrime continues to pose a significant threat to global financial stability, Panama’s ability to meet AML/CFT standards will remain a key concern for the region. The country must prioritize addressing cybercrime and preventing the misuse of financial institutions to rebuild its reputation as a secure and stable financial hub.

Conclusion

The FATF’s decision to remove Panama from its grey list is seen as a positive step towards improving the country’s AML/CFT regime. However, the country must continue to work towards strengthening its regulatory framework and ensuring that financial institutions are transparent and accountable.