Guatemala’s Anti-Money Laundering and Combating Financing of Terrorism Efforts Face Scrutiny

Guatemala recently underwent a mutual evaluation by international financial experts to assess its progress in implementing measures to prevent money laundering (AML) and combating financing of terrorism (CFT). The country received a mixed assessment, with some areas deemed compliant or largely compliant, while others showed room for improvement.

Areas of Strength

Assessing Risk and Applying a Risk-Based Approach: Guatemala was found to be largely compliant in assessing risk and applying a risk-based approach, indicating its ability to identify and mitigate potential threats.
National Cooperation and Coordination: The country received a compliant rating in national cooperation and coordination, suggesting effective collaboration between different government agencies and stakeholders.
Money Laundering Offence: Guatemala was found largely compliant in criminalizing money laundering, demonstrating its commitment to addressing this issue.

Areas of Improvement

Terrorist Financing Offence: The country was found partially compliant in criminalizing terrorist financing, suggesting it still needs to strengthen its laws and regulations in this regard.
Targeted Financial Sanctions Related to Terrorism and Terrorist Financing: Guatemala received a partial compliance rating for targeted financial sanctions related to terrorism and terrorist financing, indicating it needs to improve its mechanisms for imposing and enforcing these sanctions.
Correspondent Banking: The country was found partially compliant in regulating correspondent banking, suggesting it needs to improve its oversight of international financial transactions.

Regulatory Framework

Non-Profit Organisations: Guatemala was found largely compliant in regulating non-profit organisations, demonstrating its commitment to preventing abuse of these entities.
Financial Institution Secrecy Laws: The country received a compliant rating for financial institution secrecy laws, indicating its ability to maintain the confidentiality of client information while still facilitating cooperation with foreign authorities.

Customer Due Diligence and Record Keeping

Customer Due Diligence: Guatemala was found largely compliant in customer due diligence, suggesting it is able to properly identify and verify customers.
Record Keeping: The country received a compliant rating for record keeping, indicating its ability to maintain accurate and detailed records of transactions.

Other Areas

Politically Exposed Persons: Guatemala was found largely compliant in regulating politically exposed persons, demonstrating its commitment to preventing corruption and abuse of power.
New Technologies: The country received a partial compliance rating for new technologies, suggesting it needs to improve its ability to address emerging risks and threats.

Overall, Guatemala’s efforts to combat money laundering and terrorist financing have been recognized as partially compliant with international standards. While the country has made significant progress in many areas, there are still several weaknesses that need to be addressed to ensure the effective prevention of these threats.