Financial Crime World

Africa’s Fight Against Money Laundering in Nicaragua Takes Center Stage

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Nicaragua, a country in Central America, has been making significant strides in its fight against money laundering. In its most recent mutual evaluation report, the Financial Action Task Force (FATF) rated Nicaragua as “partially compliant” with 16 of the 40 recommendations aimed at combating money laundering and terrorist financing.

Progress Made

One of the key areas where Nicaragua has made progress is in assessing risk and applying a risk-based approach to combat money laundering. The country has also shown improvement in its national cooperation and coordination efforts, with law enforcement agencies working closely together to tackle financial crimes.

  • Risk assessment and risk-based approach: Nicaragua has improved its ability to identify and assess risks related to money laundering and terrorist financing.
  • National cooperation and coordination: Law enforcement agencies are now working more effectively together to combat financial crimes.

Challenges Remain

However, Nicaragua still faces challenges in implementing some of the FATF recommendations. For instance:

  • Strengthening laws and regulations related to terrorist financing and proliferation: Nicaragua needs to improve its legal framework to better address these threats.
  • Improving customer due diligence and record-keeping practices: The country must enhance its internal controls and foreign branch and subsidiary supervision to prevent money laundering and terrorist financing.

Correspondent Banking

In terms of correspondent banking, Nicaragua has made significant progress in recent years. Several international banks have established relationships with local financial institutions. However:

  • Transparency and beneficial ownership: Nicaragua needs to improve its transparency and beneficial ownership of legal persons and arrangements to strengthen its anti-money laundering efforts.

Regulation and Supervision

The FATF mutual evaluation report also highlighted the need for Nicaragua to:

  • Improve regulation and supervision of financial institutions: The country must enhance its powers of supervisors and provide more guidance and feedback to financial institutions.
  • Strengthen financial intelligence units: Nicaragua needs to improve its ability to collect, analyze, and disseminate financial intelligence.

Conclusion

Despite these challenges, Nicaragua’s efforts to combat money laundering are commendable. The country has made significant progress in recent years and has demonstrated a commitment to implementing the FATF recommendations. As Africa continues to work towards strengthening its fight against money laundering, Nicaragua’s experience can serve as an important model for other countries in the region.

The article highlights the key areas where Nicaragua has made progress and still needs improvement, providing a comprehensive overview of the country’s efforts to combat money laundering.