Financial Crime World

Dominica’s Anti-Money Laundering and Combating the Financing of Terrorism Efforts Receive Mixed Review

A recent assessment by international experts has highlighted both strengths and areas for improvement in Dominica’s efforts to combat money laundering (ML) and terrorist financing (TF).

Strengths

  • Strong commitment to national strategy and policy setting, with the development of a National Policy and National Strategy.
  • Significant coordination and cooperation between law enforcement agencies.

Weaknesses

  • Low TF risk profile assessment based on limited analysis, as several sectors and activities were not assessed, including cross-border wire transfers, non-profit organizations (NPOs), legal persons, and virtual asset service providers (VASPs).
  • No prosecutions or convictions in the period under review for terrorist financing.
  • Limited powers of the Financial Intelligence Unit (FIU) to obtain financial information for identifying and investigating ML and TF cases.
  • Lack of a national CFT policy that would continuously assess the TF threat and identify requirements for training and professional development of law enforcement agencies.

Implementation of UNSCR Resolutions

  • Dominica has updated its legal framework and developed Central Authority procedures, but these procedures do not accurately distinguish between what is required under the two UNSCR resolutions.
  • Freeze without delay mechanism is also deficient.

Supervision and Training

  • Financial Services Unit (FSU) as primary supervisory authority has implemented training to regulated entities to raise awareness of TF requirements in the Saint Lucia Financial Task Force (SFTA).
  • Regulated entities have demonstrated an awareness of TF, but FSU has not issued guidance on TF to financial institutions or designated non-financial businesses and professions (DNFBPs) on their obligations.
  • Substantial work remains for the FSU, supervisor of NPOs, to implement a targeted approach, outreach, or oversight of that sector.

Recommendations

  1. Conduct a comprehensive sector review of NPOs to inform the country’s assessment of TF risk.
  2. Develop a national CFT policy that would continuously assess the TF threat and identify requirements for training and professional development of law enforcement agencies.
  3. Implement a targeted approach, outreach, or oversight of NPOs.
  4. Provide guidance on TF to financial institutions or DNFBPs on their obligations.
  5. Conduct regular reviews and assessments of the country’s anti-money laundering and combating the financing of terrorism regime.

Conclusion

Dominica’s efforts to combat ML and TF have shown promise, but there is still much work to be done to effectively address these threats. By implementing the recommendations outlined above, the country can improve its anti-money laundering and combating the financing of terrorism framework and ensure that it is better equipped to detect and prevent financial crimes.