Limited Guidance, Awareness, and Feedback Hamper Financial Intelligence in St. Kitts and Nevis
A recent report has highlighted several key factors that are contributing to the low numbers of Suspicious Transaction Reports (STRs) submitted by financial institutions and designated non-financial businesses and professions (DNFBPs) to the Financial Intelligence Unit (FIU) in St. Kitts and Nevis.
Lack of Guidance, Awareness, and Feedback
The report emphasizes the importance of guidance, awareness, and feedback in improving STR reporting. However, it notes that there is a lack of understanding among financial institutions and DNFBPs about their reporting obligations. As a result, the level of STR reporting remains low, despite St. Kitts and Nevis’ vulnerability assessment indicating a need for increased vigilance.
FIU Information Technology System Concerns
The report also raises concerns over the FIU’s information technology system, which is overseen by an officer external to the FIU. This has led to security concerns about data confidentiality and independence.
Well-Established Technical Framework for Investigating Money Laundering
On the other hand, the WCCU (a unit of the Royal St. Christopher & Nevis Police Force) has a well-established technical framework for investigating money laundering and conducting prosecutions. However, despite having a strong team of investigators, the number of ML investigations remains low.
Limited Experience in Asset Recovery with Foreign Counterparts
The report notes that there is no indication that the findings from the National Risk Assessment (NRA) were taken into consideration when selecting ML investigations, leading to a lack of aggressive investigation of money laundering cases. Additionally, St. Kitts and Nevis has limited experience in asset recovery with foreign counterparts, making it challenging for the country to recover proceeds of crime located abroad or laundered outside the jurisdiction.
Authorities’ Efforts to Address Issues
The authorities have implemented measures to address some of these issues, including legislative amendments that increased investigative techniques available to the WCCU. However, more needs to be done to improve guidance, awareness, and feedback among financial institutions and DNFBPs to increase the number of STRs submitted to the FIU.
Conclusion
The report concludes that St. Kitts and Nevis has made significant progress in establishing a technical framework for investigating money laundering, but there is still much work to be done to address the underlying issues hampering financial intelligence in the country.
Recommendations
- Improve guidance, awareness, and feedback among financial institutions and DNFBPs
- Enhance the FIU’s information technology system to ensure data confidentiality and independence
- Increase the number of ML investigations by taking into consideration findings from the National Risk Assessment (NRA)
- Develop experience in asset recovery with foreign counterparts to improve the country’s ability to recover proceeds of crime located abroad or laundered outside the jurisdiction.