Financial Crime World

Jamaica’s Financial Crimes Statistics: $700 Million to $800 Million Annual Fraud Value

According to a senior official at the Bank of Jamaica (BOJ), the value of all frauds in the banking system is estimated to be between $700 million and $800 million annually.

A Decline in Fraud Activity?

Dr. Jide Lewis, deputy governor of the BOJ, revealed that the current fraud estimate reflects a decline compared to previous counts by the central bank. He stated, “When you look at fraudulent activity in the banking system, it is currently at around $700 to $800 million. When I did a quick check, it is certainly running at about $10 million a month per institution.”

Comparison to Other Jurisdictions

While Jamaica’s fraud statistics are not doing badly compared to other jurisdictions, the country still requires improvement. The current estimate is down from an average annual value of $1 billion, which was found during a 46-month study covering January 2018 to October 2021.

FATF Compliance

Jamaica needs to complete 13 action items in order to fully comply with the 40 measures of the Financial Action Task Force (FATF), a global watchdog over money laundering and terrorist financing. The country has been on the FATF grey list since January 2020, along with other Caribbean countries.

Progress Update

Lewis emphasized that Jamaica is largely compliant with six of the 13 action items and must demonstrate significant progress in completing the remaining tasks. A meeting will be held later this month to assess the country’s progress, followed by a final decision on whether it will be removed from the grey list in the summer.

Card Fraud Statistics

The BOJ study found that most fraud incidents relate to credit and debit card fraud, with an estimated total value of $3.3 billion or four-fifths of the total fraud. The report noted that card fraud losses averaged 0.95 percent of Jamaica’s total output and less than one percent of the banking system’s regulatory capital per annum.

UK Privy Council Ruling

In related news, a UK Privy Council ruling handed down on Thursday against the Jamaican Bar Association has significant implications for the country’s efforts to combat money laundering. The ruling states that lawyers in Jamaica must report suspicious financial transactions under the Proceeds of Crime Act (POCA), or face sanctions.

Next Steps

Lewis described the ruling as “fairly significant” but emphasized that there are other issues that need to be addressed to ensure Jamaica’s compliance with FATF standards. He noted that the country must demonstrate a framework that allows all stakeholders, including designated parties and investigative arms of the judicial system, to support efforts to combat money laundering.

Key Takeaways

  • The value of all frauds in Jamaica’s banking system is estimated to be between $700 million and $800 million annually.
  • Fraud activity has declined compared to previous estimates.
  • Jamaica needs to complete 13 action items to comply with FATF standards.
  • Card fraud accounts for the majority of fraud incidents, with an estimated total value of $3.3 billion.
  • A UK Privy Council ruling requires lawyers in Jamaica to report suspicious financial transactions under the Proceeds of Crime Act (POCA).