Financial Crime World

Timor-Leste’s Fight Against Money Laundering: Challenges and Progress

The Long and Arduous Battle Against Money Laundering

Dili, East Timor - The fight against money laundering in Timor-Leste has been a long and challenging one. Law enforcement authorities have worked tirelessly to investigate and prosecute cases of this serious crime. In 2015, the Public Prosecutor’s Office (PFMCBP) initiated an internal investigation into a case of embezzlement and domestic money laundering, which was eventually solved in 2018.

A Successful Investigation

The case involved a suspect committing embezzlement and domestic money laundering crimes, which were successfully investigated by authorities. The proceeds of crime were recovered by the state, bringing justice to the victims.

Combating Money Laundering as an Independent Crime

In addition to investigating individual cases, Timor-Leste’s authorities are aware of the serious threat that money laundering poses to the country’s economy and financial sector. To combat this, they have implemented a direct investigation process, allowing them to investigate and prosecute money laundering as an independent crime.

The Role of the Financial Intelligence Unit (FIU)

The FIU plays a crucial role in this process, analyzing suspicious transaction reports (STRs) and reporting its findings to the General Prosecutor’s Office. In 2018, there were 109 STRs reported, with about 20 substantiated and reported to the General Prosecutor’s Office for further criminal proceedings.

Challenges Facing the Investigation of Money Laundering

Despite progress made, there are still challenges facing the investigation of money laundering in Timor-Leste:

  • Cash-Based Economy: The country’s cash-based economy makes it difficult for law enforcement authorities to conduct effective investigations using tracing methods.
  • Limited International Cooperation: Timor-Leste has faced difficulties in obtaining cooperation from foreign authorities on mutual legal assistance (MLA). This is due to the reluctance of some foreign authorities to fulfill MLA requests from Timor-Leste.
  • Limited Human Resources: With only 24 investigators at the Anti-Corruption Commission (ACC) and five specialized public prosecutors dedicated to handling corruption, money laundering, and organized crime, the country’s law enforcement authorities face significant challenges in coordinating and cooperating with foreign authorities.

Commitment to Combating Money Laundering

Despite these challenges, Timor-Leste’s authorities remain committed to combating money laundering. By continuing to work together and addressing the challenges facing them, they can bring justice to those who have been affected by this serious crime and protect the country’s economy and financial sector from the threat of money laundering.