Financial Crime World

Financial Crime Prevention Measures in Guatemala Leave Much to Be Desired, Report Finds

A new report released by a Washington-based think tank has highlighted the alarming rate of financial crimes in Latin America and the Caribbean, with Guatemala being one of the countries most affected.

Financial Crimes on the Rise in Latin America and the Caribbean

  • Corruption: The most prevalent financial crime affecting the region
  • Money Laundering: Followed closely by money laundering, trade-based money laundering, and terrorism financing
  • Illicit Proceeds: Corruption is the largest source of illicit proceeds in Guatemala

Challenges Faced by Guatemala in Combating Financial Crimes

  • Inadequate Implementation: Many countries in the region have made improvements to their anti-money laundering (AML) and combating the financing of terrorism (CFT) laws, but implementation is often incomplete
  • Lack of Political Will: Political will varies across countries in the region
  • Insufficient Expertise: Experts interviewed for the report assessed the effectiveness of their country’s efforts to combat financial crimes on a scale from 1 to 5. The average score for Guatemala was 2.47 out of 5.

Recommendations for Guatemala

  • Establishing Courts Dedicated to Financial Crimes: Establishing courts that only address financial crime, staffed with prosecutors and judges trained in the relevant subject matter.
  • Staff Exchange Programs: Implementing longer-term staff exchange programs within the LAC region and between the LAC region and the US to ensure effective knowledge transfer and efficient partnerships.
  • FATF Mutual Evaluations: Ensuring that FATF mutual evaluations consider whether countries “weaponize” AML/CFT laws against political opponents, non-profits, etc.

Response from the Guatemalan Government

  • Strengthening AML/CFT Laws: Guatemala’s Finance Minister announced plans to strengthen the country’s AML/CFT laws and improve implementation.
  • Increasing Transparency and Accountability: The government also pledged to increase transparency and accountability in its financial institutions.