Financial Crime World

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Honduras Struggles with Financial Sanctions and Compliance, Says Follow-Up Report

A recent follow-up report from a leading global organization has highlighted Honduras’ ongoing challenges in implementing effective financial sanctions and compliance measures.

Assessment of Compliance

According to the report, Honduras was found to be:

  • Largely compliant in several areas, including:
    • Assessing risk and applying a risk-based approach (R.1)
    • National cooperation and coordination (R.2)
    • Money laundering offence (R.3)
  • Partially compliant in other areas, such as:
    • Confiscation and provisional measures (R.4)
    • Terrorist financing offence (R.5)
    • Financial institution secrecy laws (R.9)
  • Non-compliant in critical areas, including:
    • Transparency and beneficial ownership of legal persons (R.24) and arrangements (R.25)

Key Findings

The report also highlighted Honduras’ lack of progress in implementing effective measures to combat:

  • Money or value transfer services (R.14)
  • The use of new technologies (R.15) Additionally, it noted that Honduras has not yet established a sufficient regulatory framework for DNFBPs (R.22), nor has it implemented adequate internal controls and foreign branches and subsidiaries (R.18).

Response to the Report

In response to the report’s findings, Honduran authorities have vowed to take immediate action to address the identified shortcomings.

“We are committed to improving our country’s financial sanctions and compliance regime,” said a government spokesperson. “We will work closely with international partners to strengthen our laws and regulations and ensure that we meet the high standards set by the FATF.”

International Observations

The report’s findings come as no surprise, given Honduras’ long-standing reputation for corruption and lack of transparency in its financial system. However, the country’s willingness to address these issues is a positive step forward, and it will be closely watched by international observers in the coming months.