Palau Takes Steps to Combat Financial Crimes and Enhance Compliance Efforts

The Republic of Palau’s Financial Intelligence Unit (FIU) has been at the forefront of combating financial crimes and ensuring compliance with anti-money laundering and counter-terrorism financing (AML/CFT) regulations.

Mandate and Responsibilities

Established in 2001, the FIU is responsible for investigating suspected proceeds of crime and terrorist property, as well as ensuring that entities under its supervision comply with AML/CFT requirements. The FIU’s mandate includes supervising financial institutions and designated non-financial businesses and professions (DNFBPs), including:

• Attorneys
• High-value dealers
• Real estate agents

International Cooperation and Compliance

As a member of the Asia-Pacific Group (APG) and a Financial Action Task Force (FATF)-style regional body, Palau works towards compliance with FATF 40 Recommendations and 11 Immediate Outcomes. The FIU is committed to working closely with international partners to prevent and detect financial crimes.

Strategic Plan FY 2023-2028

In September 2022, the FIU and FIC conducted a strategic planning retreat, resulting in the adoption of the Palau FIU Strategic Plan FY 2023-2028 in April 2023. The plan outlines the FIU’s goals and objectives for the next five years, including:

• Enhancing its capacity to analyze financial intelligence
• Improving cooperation with international partners
• Increasing public awareness of AML/CFT risks

Implementation and Benefits

The implementation of the strategic plan will require significant resources and efforts from all parties involved. However, the benefits of a robust AML/CFT regime are clear, including:

• Protection of the country’s financial system
• Prevention of illicit activities
• Promotion of transparency and integrity in business dealings

The FIU is well-positioned to lead Palau’s efforts in this regard, and its strategic plan provides a roadmap for success.