Suriname’s Banking Regulations Compliance in Jeopardy: Experts Warn of Money Laundering Risks
Suriname, a small South American country, has long been plagued by poor regulation and endemic corruption, making it an attractive haven for money launderers. The country’s lack of laws and weak institutions have created a perfect storm for criminal activity, with estimated annual losses ranging from $56 million to $139 million.
Anti-Money Laundering (AML) Efforts in Jeopardy
Despite having AML statues on the books, Suriname has failed to implement them effectively, allowing criminals to operate with impunity. The government’s unwillingness to tackle money laundering has been exacerbated by rampant corruption at all levels, including the highest echelons of power.
Weak Banking Sector
The banking sector is a key weakness in AML efforts, with banks prioritizing profit over compliance and lacking the technical knowledge and expertise to detect and prevent money laundering. This risks Suriname being cut off from the rest of the world due to its poor banking practices, keeping the economy largely cash-based.
Key Facilitators for Money Laundering
- Lawyers
- Notaries
- Car dealers
- Currency exchanges
- Fintech companies
- Jewelry industry (identified as a major channel for money laundering)
- Large quantities of illegal gold being smuggled into the country
Drug Trafficking and Terrorist Financing Risks
- Suriname serves as a key transit point for cocaine from Colombia and Venezuela to Europe.
- The country’s porous borders with Brazil and Guyana make it easy for drugs and other illicit goods to be smuggled in and out of the country.
- Terrorist financing remains a significant concern, with the former head of the Anti-Terrorism Unit convicted of conspiring to import drugs and provide material support to Hezbollah.
A Glimmer of Hope
Suriname completed a national risk assessment in 2021, but there is little expectation that the government will take action to address the identified risks. The country’s new government, led by Chan Santhokhi, a former police chief, has significant ties to the previous administration, which was marred by corruption and money laundering.
What Can Businesses Do?
Businesses operating in or planning to enter the Surinamese market should be aware of these AML challenges and take steps to ensure compliance with regulations. VinciWorks has developed a comprehensive guide to help businesses navigate the complex AML landscape in Latin America and the Caribbean. Download our free guide today to learn more about the key AML risks and laws in Suriname and how your business can stay compliant.