Honduras Fails to Meet FATF Compliance Requirements, Ratings Show

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A recent report from the Financial Action Task Force (FATF) has revealed that Honduras has fallen short of meeting several compliance requirements for fighting money laundering and terrorist financing.

Key Findings

• Honduras received ratings of largely compliant (LC) or partially compliant (PC) in 34 out of 40 areas assessed.
• The country failed to meet standards on key issues such as:
  • Financial institution secrecy laws
  • Customer due diligence
  • Record keeping
  • Reporting of suspicious transactions

Non-Compliance Areas

Honduras was found to be non-compliant (NC) in only three areas:

• Transparency and beneficial ownership of legal persons
• Regulation and supervision of financial institutions
• Statistics

However, the country was largely compliant with regards to:

• National cooperation and coordination
• Money laundering offence
• Confiscation and provisional measures

Progress Made

The report also noted that Honduras has made progress in some areas, such as:

• Implementing targeted financial sanctions related to terrorism and terrorist financing
• Regulating and supervising designated non-financial businesses and professions (DNFBPs)

Urgent Action Required

The FATF has urged Honduras to take immediate action to address its compliance deficiencies. The country’s failure to meet international standards poses a risk to its financial system and could impact its reputation as a reliable partner for international transactions.

Timeline for Reform

Honduras has two years to implement the required reforms and demonstrate significant progress towards achieving full compliance with the FATF Recommendations. Failure to do so may result in further action from the organization, including the addition of Honduras to the list of jurisdictions subject to increased monitoring.