Financial Crime World

Dominica’s Financial Intelligence Unit Needs Improvement

A recent assessment by international experts has revealed that Dominica needs to strengthen its financial intelligence unit (FIU) and improve its ability to detect money laundering and terrorist financing.

Weaknesses Identified

While Dominica has made progress in developing its anti-money laundering (AML) and counter-terrorist financing (CFT) framework, there are still significant weaknesses that need to be addressed. The FIU, which plays a crucial role in detecting and disrupting money laundering and terrorist financing activities, needs to improve its analysis and dissemination of financial intelligence.

Concerns with Citizenship by Investment Program

The assessment also found that Dominica’s dependence on its citizenship by investment program is a major concern, as it creates a high risk of money laundering and terrorist financing. While the program has stringent vetting processes, it is essential that the country conducts a comprehensive ML/TF assessment of non-profit organizations (NPOs), legal persons, virtual asset service providers (VASPs), and other sectors to identify vulnerabilities.

Deficiencies in National CFT Policy

Furthermore, the assessment noted that Dominica lacks a national CFT policy, which would enable authorities to continuously assess the terrorist financing threat and develop policies to address it. Additionally, the country’s Central Authority procedures for implementing UN Security Council Resolution 1267 and 1373 are deficient, and regulated entities have not received guidance on their obligations under these resolutions.

Recommendations

To improve its AML/CFT regime, Dominica needs to:

  • Strengthen the FIU by improving its analysis and dissemination of financial intelligence.
  • Conduct a comprehensive assessment of NPOs, legal persons, VASPs, and other sectors to identify vulnerabilities.
  • Develop a national CFT policy to enable authorities to continuously assess the terrorist financing threat.
  • Provide training to authorities and regulated entities on AML/CFT requirements and best practices.
  • Implement effective measures to disrupt terrorist financing and prevent the misuse of its financial system.

By implementing these recommendations, Dominica can improve its AML/CFT regime and reduce the risk of money laundering and terrorist financing in its financial system.