Vulnerable Individuals in Fiji Face High Risk of Financial Exploitation

A recent report by Fiji’s Financial Intelligence Unit (FIU) has highlighted a significant threat to vulnerable individuals in the country - financial exploitation. The report, which assessed the risk of money laundering and terrorist financing in Fiji’s banking sector, found that financial institutions are more likely to be at risk from money laundering than terrorist financing.

Money Laundering Threat

The assessment revealed that while there is no substantive evidence of terrorist financing activities or transactions taking place through Fiji’s banks, the threat posed by money laundering and predicate crimes is considered high. The FIU attributed this risk to reports of suspicious transactions received from banks, as well as intelligence gathered from law enforcement agencies and other sources.

Suspicious Transactions

According to the report, most of these suspicious transactions were linked to financial crimes such as:

• Tax evasion
• Fraud
• Cybercrime
• Drug-related offenses

Intelligence suggests that substantial proceeds from these crimes are being channeled through bank accounts held by individuals and entities involved in these activities and their associates.

Vulnerability of Commercial Banks

The report also highlighted the vulnerability of commercial banks in Fiji to money laundering due to the products they offer, which provide speed and anonymity. These products include:

• Basic transaction accounts
• Cash deposits and withdrawals
• Online banking services
• Mobile phone banking services

Compliance with AML/CFT Measures

All banks in Fiji are required by law to comply with anti-money laundering (AML) and combating the financing of terrorism (CFT) measures, including reporting suspicious transactions to the FIU. The report revealed that between 2019 and 2021, commercial banks submitted a significant proportion of all suspicious transaction reports received by the FIU.

Call to Action

The findings of this report underscore the need for financial institutions in Fiji to remain vigilant in detecting and preventing money laundering and terrorist financing activities. It is also essential that law enforcement agencies and regulatory bodies work together to address these threats and protect vulnerable individuals from financial exploitation.

Recommendations

• Financial institutions should implement robust AML/CFT measures to prevent financial exploitation
• Law enforcement agencies and regulatory bodies should collaborate to address the threats posed by money laundering and terrorist financing
• Vulnerable individuals should be educated on the risks of financial exploitation and how to protect themselves from such activities