Money Laundering Schemes in New Caledonia: A Growing Concern
The European Union’s anti-money laundering directives have been implemented in various forms across its member states, including France and its overseas territories. However, a recent investigation has revealed that the financial system in New Caledonia is vulnerable to money laundering schemes.
Regulatory Framework
In 1990, the EU adopted its first anti-money laundering directive, requiring obliged entities to apply customer due diligence requirements when entering into business relationships. Since then, the directive has been revised several times to mitigate risks related to money laundering and terrorist financing.
New Caledonia, as a French overseas territory, is subject to French laws and regulations. The Monetary and Financial Code (MFC) sets forth anti-money laundering regulations applicable in New Caledonia, including vigilance obligations, reporting requirements, and asset freezing mechanisms.
Insurance Companies Under Scrutiny
Insurance companies operating in New Caledonia are required to comply with the anti-money laundering regulations. This includes:
- Identifying customers and verifying their identities
- Monitoring transactions
- Reporting suspicious activities
However, a recent investigation has revealed that some insurance companies may be failing to meet these requirements, leaving them vulnerable to money laundering schemes.
Vigilance Obligation
Insurance companies in New Caledonia are required to exercise vigilance when entering into business relationships with customers. This includes:
- Assessing the risk of money laundering or terrorist financing
- Taking necessary measures to prevent it
Reporting Obligation
Insurance companies are also required to report any suspicious transactions to the authorities. This includes reporting sums entered in their books or transactions involving sums that originate from an offence punishable by a custodial sentence of more than one year.
Asset Freezing Mechanism
The MFC sets forth an asset freezing mechanism, which allows authorities to freeze assets suspected of being linked to money laundering or terrorist financing.
Conclusion
Money laundering schemes are a growing concern in New Caledonia. Insurance companies operating in the territory must ensure that they comply with anti-money laundering regulations to prevent such schemes from occurring. The authorities must also take necessary measures to monitor and investigate suspicious activities, ensuring that the financial system remains secure and trustworthy.