Puerto Rico Takes Steps to Combat Financial Crimes, Removed from High-Risk List
The United States Department of the Treasury’s 2024 National Money Laundering Risk Assessment has removed Puerto Rico from its high-risk list due to significant efforts by the island’s government and regulatory agencies to combat financial crimes and money laundering.
Recent Efforts to Combat Financial Crimes
Under the leadership of Governor Pedro Pierluisi, Puerto Rico has taken several steps to strengthen its anti-money laundering framework. The Office of the Commissioner of Financial Institutions (OCIF), led by Commissioner Natalia Zequeira, has been instrumental in these efforts.
- Strengthening Investigative Unit: The OCIF has enhanced its investigative capabilities to better detect and prevent financial crimes.
- Increased Supervision: Regulatory agencies are now more closely monitoring financial institutions to ensure compliance with federal and state laws.
- Action Against Non-Compliant Institutions: Institutions that fail to comply with regulations have been taken action against, further strengthening the regulatory framework.
New Mandates for International Banking Entities (IBEs) and International Financial Entities (IFEs)
Two new mandates, Acts 44 and 45 of 2024, have been passed to improve the regulatory framework for IBEs and IFEs. These acts aim to strengthen anti-money laundering regulations and combat money laundering.
Praise from US Treasury Department
Brian Nelson, Under Secretary for Terrorism and Financial Intelligence at the US Treasury Department, recently met with Governor Pierluisi to discuss key illicit finance issues, including countering fentanyl trafficking and strengthening anti-money laundering regulations. Nelson praised Puerto Rico’s progress, stating that the passage of Act 273 reflects the Treasury’s regulatory reform agenda.
Challenges Remain
While Puerto Rico has made significant progress in combating financial crimes, challenges remain for IBEs and IFEs. These entities are struggling to process transactions due to US banks minimizing their exposure risks by closing accounts. Governor Pierluisi emphasized the need for continued support from the federal government to ensure compliance with regulations.
Ongoing Efforts
The visit by Brian Nelson is part of a larger effort to promote financial stability and combat money laundering in Puerto Rico. His trip follows that of Andrea Gacki, Director of the Financial Crimes Enforcement Network (FinCEN), who hosted the first-ever FinCEN Exchange in Puerto Rico in February.
Background
Puerto Rico was previously identified as a high-risk jurisdiction due to the existence of “cooperativas” credit unions and IBEs/IFEs. However, the island’s efforts have paid off, and it is no longer considered a high-risk jurisdiction by the US Treasury Department.
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