Money Laundering Methods in Nicaragua: A Closer Look

The Financial Action Task Force (FATF) has recently evaluated the methods used for money laundering in Nicaragua, finding that while the country has made significant progress, there are still areas requiring improvement.

Assessing Risk and Applying a Risk-Based Approach

Nicaragua received a partially compliant rating in this area, indicating that while the country has established a risk assessment framework, it needs to improve its application and review of risks associated with different sectors and transactions.

National Cooperation and Coordination

The country received a largely compliant rating for national cooperation and coordination, indicating that Nicaragua has made significant progress in establishing effective coordination mechanisms between financial intelligence units, law enforcement agencies, and other relevant authorities.

Money Laundering Offence

Nicaragua was found to have a largely compliant rating in this area, indicating that the country’s laws and regulations adequately criminalize money laundering. However, there is still room for improvement in terms of ensuring effective prosecution and sentencing for money laundering offenses.

Confiscation and Provisional Measures

The country received a largely compliant rating for confiscation and provisional measures, meaning that Nicaragua has established effective mechanisms for freezing and confiscating assets related to money laundering and terrorist financing.

Terrorist Financing Offence

Nicaragua was found to have a partially compliant rating in this area, indicating that while the country has criminalized terrorist financing, there is still room for improvement in terms of ensuring effective prosecution and sentencing for these offenses.

The country received a largely compliant rating for targeted financial sanctions related to terrorism and terrorist financing, indicating that Nicaragua has established effective mechanisms for imposing targeted sanctions against individuals and entities involved in terrorist activities.

Non-Compliant Areas

Nicaragua was found to have non-compliant ratings in the following areas:

Targeted Financial Sanctions Related to Proliferation
New Technologies
DNFBPs: Customer Due Diligence
DNFBPs: Other Measures

Progress and Recommendations

Overall, Nicaragua’s financial system has made significant progress in combating money laundering and terrorist financing. However, there are still areas where improvement is needed to ensure effective implementation of anti-money laundering and counter-terrorist financing regulations.

Recommendations for improvement include:

Strengthening risk assessment frameworks
Improving customer due diligence practices
Enhancing supervision and monitoring of non-profit organizations
Implementing adequate measures to address the risks associated with new technologies and DNFBPs

By addressing these areas, Nicaragua can further strengthen its financial system and reduce the risks associated with money laundering and terrorist financing.