Financial Crime World

Financial Crime Case Studies: Suriname’s Money Laundering Challenges Revealed

Suriname has been identified as a haven for money launderers due to its lack of regulations, weak institutions, and endemic corruption. The country’s financial sector is plagued by poor banking practices, with banks prioritizing profit over compliance, leaving the economy largely cash-based.

Key Risks Contributing to Suriname’s Reputation

  • Corruption at all levels of government: High-ranking officials have been embroiled in scandals and bribery.
  • Drug trafficking: The country’s strategic location between Colombia and Venezuela has made it a major hub for drug trafficking.
  • Mineral trafficking: Corruption and lack of regulation have fueled illegal activities such as gold smuggling, illegal logging, and timber trafficking.
  • Porous borders: Borders with Brazil and Guyana are easy to breach, allowing smugglers to bring in illegal goods.

Estimated Annual Money Laundering

The report estimates that an astonishing $56 million to $139 million is laundered every year in Suriname.

Challenges in Enforcing Anti-Corruption Laws and Implementing AML Measures

  • Lack of enforcement: Despite having anti-corruption laws on the books, they are rarely enforced.
  • Weak banking sector: Banks fail to implement effective anti-money laundering measures due to a lack of technical expertise and knowledge.

Key Facilitators of Money Laundering

  • Lawyers
  • Notaries
  • Car dealers
  • Currency exchanges
  • Fintech companies

Industry Resistance to National Risk Assessment

The jewelry industry and the car industry have refused to participate in the national risk assessment, which has labeled them as key channels of money laundering.

Terrorist Financing Risk

A former head of the Anti-Terrorism Unit was convicted in a US federal court of conspiring to import drugs and provide material support to Hezbollah.

Positive Developments and Challenges Ahead

  • National risk assessment completed in 2021: A positive step towards addressing money laundering risks, but…
  • Limited hope for government action: The previous government, led by convicted murderer and drug trafficker Desi Bouterse, still maintains significant influence in the new government.

Conclusion: High Risk of Financial Sector Isolation

Suriname’s financial sector is at high risk of being cut off from the rest of the world due to its poor banking practices.