Financial Crime World

St. Kitts and Nevis: Mutual Evaluation Report Highlights Progress, But Concerns Remain

The Caribbean Financial Action Task Force (CFATF) has recently released a mutual evaluation report on St. Kitts and Nevis’ efforts to combat money laundering and terrorist financing. The report highlights both progress and concerns in the country’s anti-money laundering and combating the financing of terrorism (AML/CFT) regime.

Progress Made

The report notes that St. Kitts and Nevis has developed a National Action Plan (NAP) to mitigate risks identified in its AML/CFT regime, as well as a national AML/CFT strategic plan for 2021. Additionally, the country has established a cross-border reporting system (CBRs) to detect cash and bulk currencies exceeding $10,000 at ports of entry and exit.

Areas Requiring Improvement

However, the report also identifies several areas where improvements are needed:

  • Low Level of Suspicious Transaction Reports: The Financial Intelligence Unit (FIU) distributes typologies and advisories to financial institutions and designated non-financial businesses and professions (DNFBPs), but guidance, awareness, and feedback are still limited.
  • Lack of Understanding among FIs and DNFBPs: Many financial institutions and DNFBPs lack understanding of their reporting obligations, leading to a low level of ML investigations.
  • Insufficient Confiscation Proceedings: St. Kitts and Nevis did not have a national policy objective for the confiscation of criminal proceeds, instrumentalities, and property of equivalent value until March 2021. There is also no dedicated unit within the WCCU or DPP for conducting confiscation proceedings or asset forfeiture.
  • Limited Experience in Asset Recovery: The country has limited experience in recovering assets with foreign counterparts.

Recommendations

The CFATF report provides a roadmap for St. Kitts and Nevis to address these concerns and strengthen its AML/CFT regime. Some key recommendations include:

  • Improving guidance, awareness, and feedback on suspicious transaction reporting
  • Enhancing understanding among FIs and DNFBPs of their reporting obligations
  • Developing a national policy objective for the confiscation of criminal proceeds, instrumentalities, and property of equivalent value
  • Establishing a dedicated unit within the WCCU or DPP for conducting confiscation proceedings or asset forfeiture

Overall, while St. Kitts and Nevis has made some progress in its efforts to combat money laundering and terrorist financing, there are still several areas that require improvement. The CFATF report provides a roadmap for the country to strengthen its AML/CFT regime and address these concerns.