Financial Crime World

Financial Crime on French Guiana’s Radar: Banking Industry Lacks Effective Response

France’s Robust Anti-Money Laundering Framework Falls Short in Overseas Territories

In a stark contrast to its robust anti-money laundering framework, France’s banking industry in overseas territories is struggling to combat illicit financial activities linked to drug trafficking. A recent evaluation report by the Financial Action Task Force (FATF) highlights critical gaps in controlling profits from illegal trade in French Guiana and other overseas territories.

FATF Report Highlights Critical Gaps in French Guiana

The FATF report, released on Wednesday, praised France’s “robust and sophisticated framework” for combating money laundering and terrorist financing. However, it also noted that the country’s maritime access to the Mediterranean and Atlantic via EU and overseas borders makes it vulnerable to drug trafficking.

Key Findings from the FATF Report:

  • Profits from crimes such as theft, fraud, and misuse of corporate funds are difficult to evaluate in French Guiana due to a lack of formal international cooperation.
  • The absence of a specific strategy for this geographical zone is also a concern.
  • Proceeds from these offences often end up in bank accounts in the sub-region, where international cooperation is challenging.

Insufficient Supervision in Non-Financial Sector

The FATF also noted that France’s supervision in the non-financial sector, particularly for real estate agents and notaries, is insufficient. This industry is vulnerable to illicit financial activities, and increasing the number of money laundering technical specialists across competent authorities is recommended.

Call for Urgent Attention from French Authorities

The lack of effective response from the banking industry in French Guiana raises concerns about the scale of illicit financial activities in the region. As FATF pointed out, the situation requires urgent attention to prevent further exploitation of vulnerabilities.

Recommendations:

  • Immediate action must be taken by French authorities to address these gaps and ensure that their anti-money laundering framework is applied consistently across all territories.
  • Ongoing vigilance and a high level of awareness are essential to adapt to rapidly evolving criminal practices.