Financial Crime World

Cook Islands Fears Over Money Laundering Threats as Resources Struggle to Keep Pace

The Cook Islands Police has expressed concerns over the lack of resources to investigate money laundering (ML) and terrorist financing (TF) threats, amid growing fears that the country’s financial system is vulnerable to exploitation.

Financial Intelligence Unit’s Audit Program

The Financial Intelligence Unit (FIU) has been tasked with developing a robust audit program to ensure compliance with the Financial Transactions Reporting Act 2017 (FTRA 2017), which aims to bring the Cook Islands’ anti-money laundering/combating the financing of terrorism (AML/CFT) regime in line with current international standards.

Trust and Corporate Service Providers at Risk

However, the police have warned that trust and corporate service providers (TCSPs) are at risk of being associated with ML/Terrorist Financing (TF) and other criminal activity if they do not exercise control over assets, businesses, or activities of entities owned by a trust. The lack of due diligence on management or business activities could lead to increased risks.

Increased Risks

  • Lack of control over assets, businesses, or activities
  • Inadequate due diligence on management or business activities
  • Increased vulnerability to ML/TF threats

Information Sharing and Collaboration

The police have also expressed concerns over the lack of clear information sharing between government agencies, which could hinder efforts to combat ML/TF threats.

Benefits of Improved Information Sharing

  • Enhanced detection and disruption of ML/TF methods and activity
  • Improved coordination and cooperation between government agencies
  • Strengthened national effort to combat ML/TF/FOP threats

Combating Money Laundering Threats

To combat these risks, the Cook Islands must understand its vulnerabilities and how they can be exploited. This requires a concerted national effort to detect, disrupt, deter, and mitigate ML/TF/FOP threats through effective cooperation between government agencies and the private sector.

Sources:

  • Financial Intelligence Unit (FIU)
  • World Bank
  • International Monetary Fund