Financial Crime World

FRANCE’S BANKING INDUSTRY FACES CHALLENGES IN COMBATING FINANCIAL CRIME IN OVERSEAS TERRITORIES

Top OECD Country Struggles with Financial Crime in Overseas Territories

Paris, May 20 - Despite being ranked among the top OECD countries in tackling financial crime, France’s banking industry is struggling to combat illicit activities related to drug trafficking in its overseas territories. A recent evaluation report by the Financial Action Task Force (FATF) highlights critical gaps in control over profits from illegal trade in French Guiana and other overseas territories.

Challenges Facing France’s Banking Industry

  • Maritime Access: France’s maritime access to the Mediterranean and the Atlantic via both EU and overseas borders makes it vulnerable to drug trafficking, particularly for cocaine.
  • Lack of International Cooperation: Proceeds from offenses such as theft, fraud, and misuse of corporate funds are difficult to evaluate due to a lack of international cooperation in some regions.

Recommendations by FATF

  1. Increase Money Laundering Technical Specialists: France should increase the number of money laundering technical specialists across all its competent authorities.
  2. Improve Supervision in Non-Financial Sector: Improved supervision is necessary, particularly for real estate agents and notaries.

Ongoing Efforts to Combat Financial Crime

  • Strengthened Operational and Legal Arsenal: Didier Banquy, president of COLB, the national advisory board for anti-money laundering and combating the financing of terrorism (AML/CFT), acknowledged that France had strengthened its operational and legal arsenal to tackle financial crime.
  • Need for Ongoing Vigilance and Adaptation: Banquy emphasized the need for ongoing vigilance and adaptation to evolving criminal practices.

Addressing Critical Gaps in Overseas Territories

The FATF report highlighted the importance of a specific strategy for this geographical zone, which would enable authorities to better monitor and control illicit activities. France will be essential to address these critical gaps and improve cooperation with overseas territories to effectively combat financial crime and protect the country’s financial system.