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Guatemalan Financial Regulators Clamp Down on Misinformation

In an effort to maintain public trust, Guatemala’s financial regulators have taken strict measures against individuals who spread false or inaccurate information about institutions under their supervision.

Offenses and Penalties

According to Article 342 “B” of Guatemala’s penal code, it is a crime to prepare, disseminate, or reproduce by any means or communication system false or inaccurate information that undermines the confidence of clients, users, depositors, or investors of an institution subject to surveillance and inspection by the Superintendency of Banks. This includes information that causes reputational damage or leads to massive withdrawals of deposits or investments.

Those found guilty of this offense can face up to three years in prison and fines ranging from GTQ5,000 to GTQ50,000.

Regulation of Fintech

While financial regulators are yet to issue explicit regulations on conversation curation, they usually respond to complaints and investigations by issuing warnings. The underwriting process is also not explicitly regulated, but institutions must adhere to general principles and norms governing insurance activity.

In the realm of fintech, Guatemala’s regulators have established guidelines for providers processing and storing technological information, as well as contractual terms to ensure performance and accuracy. However, there are no specific regulations on blockchain assets, virtual currencies, or decentralized finance (DeFi) platforms in the country.

Open Banking Regulation

The lack of open banking regulation in Guatemala means that banks and financial institutions are prohibited from sharing client data with third-party providers. This has raised concerns about the potential risks associated with open banking.

Fraud and Focus Areas

Financial regulators in Guatemala have identified fraud as a major area of focus, with a particular emphasis on source and transfer of funds, as well as identity fraud.

Consortium Legal, a specialized law firm focusing on Central American markets, notes that fintech companies operating in Guatemala must navigate these complex regulations to ensure compliance. The firm’s experts are well-versed in banking and finance, securities, insurance, regulatory compliance, corporate, taxes, intellectual property, consumer law, privacy, data protection, and litigation, providing holistic advice to clients in the fintech sector.

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