Haiti Tightens Belts on Banking Regulations to Crack Down on Financial Crime

Combating Financial Crime and Enhancing Transparency in the Banking System

In a bid to combat financial crime and enhance transparency in its banking system, Haiti’s government has announced a series of measures aimed at tightening regulations on money transfers and foreign exchange controls.

Interconnected ATM Systems

Starting October 1, the country’s major banks, including Unibank, SOGEBANK, and Capital Bank, will be interconnected through their ATM systems. This move is expected to enhance security and convenience for customers, allowing debit card holders to withdraw cash from any machine bearing the “PRONAP” logo.

Relaxation of Foreign Exchange Controls

The government has also relaxed foreign exchange controls, allowing residents to hold unlimited amounts of foreign currency in bank accounts and transfer funds abroad without restrictions. However, authorities have cautioned that individuals who engage in suspicious transactions may face penalties under Haiti’s anti-money laundering laws.

Stricter Measures for Money Transfers

In a related development, the Haitian Central Bank (BRH) has announced plans to put in place stricter measures to monitor money transfers, in line with international standards on combating financial crime. The move is expected to help deter illicit cash flows and ensure compliance with global anti-money laundering regulations.

Addressing Concerns Over Financial Crime

According to officials, the government’s efforts are aimed at addressing concerns over Haiti’s reputation as a haven for financial crime, which has led to calls from the international community for greater transparency in its banking system. The country’s banking system is dominated by cash transactions, with debit cards and credit cards being widely accepted. However, there have been concerns over the lack of robust regulations and monitoring mechanisms to prevent fraud and money laundering.

Progress in Developing the Financial Sector

In recent years, Haiti has made significant progress in developing its financial sector, with several international banks and financial institutions operating in the country. However, the government’s efforts to combat financial crime are seen as crucial in maintaining investor confidence and promoting economic growth.

Enhancing Transparency in Foreign Exchange Dealings

The BRH has also taken steps to enhance transparency in its foreign exchange dealings, publishing a daily reference rate for the Haitian gourde (HTG) and allowing banks and currency exchange companies to set their own rates at the market-clearing rate. However, officials have acknowledged that the lack of predictability in the exchange rate has been a major concern for investors.

Exploring Options for International Partnerships

In related news, Citibank is the only U.S. bank operating in Haiti, primarily serving corporate accounts. There are no local correspondent banks, but authorities say they are exploring options to establish partnerships with international financial institutions to enhance access to capital and promote economic development.