Cook Islands Concerned Over Lack of Resources to Investigate Money Laundering

The Cook Islands Police has expressed concern over the lack of resources to investigate money laundering (ML) and terrorist financing (TF) cases, citing the need for a more robust and well-structured audit programme.

Financial Intelligence Unit Report Highlights Risks

According to a recent report by the Financial Intelligence Unit (FIU), the country’s financial system may not be at direct risk, but its reputation could be compromised if Trust and Company Service Providers (TCSPs) do not have control over the assets, business, or other activities of entities owned by trusts. The report highlights that TCSPs are at most risk where they carry out limited or no due diligence on the entity’s management or business activities and assets.

Lack of Resources to Investigate ML/TF Cases

The FIU has also identified a lack of resources to investigate ML/TF cases, with the number of instances of undeclared cash being discovered at the border appearing low. The report suggests that this may be due to the lack of real means of detecting cash other than third-party information.

Need for Improved Cooperation and Information Sharing

The report further highlights the need for improved cooperation between government agencies and foreign authorities in sharing information on ML/TF cases. It recommends documenting roles and responsibilities, particularly those that receive intelligence, investigate crimes, and enforce the law, to enhance communication and dissemination of information.

Recommendation for a More Robust Audit Programme

The Cook Islands Financial Intelligence Unit (FIU) has also recommended a more robust and well-structured audit programme to test compliance with all aspects of FTRA 2017, which aims to bring the country’s Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) regime in line with current FATF standards.

Combating ML/TF Risks

The report concludes that understanding where the country is most at risk from ML/TF threats and identifying vulnerabilities can help CI combat these risks through a concerted national effort to detect, disrupt, deter, and mitigate ML/TF/FOP risks.

Key Recommendations:

• Improve cooperation between government agencies and foreign authorities in sharing information on ML/TF cases
• Document roles and responsibilities for receiving intelligence, investigating crimes, and enforcing the law
• Implement a more robust and well-structured audit programme to test compliance with FTRA 2017
• Enhance communication and dissemination of information between stakeholders