Suriname’s AML Challenges: Weak Regulation, Corruption, and Porous Borders
Suriname, a small country in Latin America, presents significant challenges for organizations seeking to comply with Anti-Money Laundering (AML) regulations. In this article, we will explore the key AML risks and regulatory landscape in Suriname, a nation known for its poor regulation, endemic corruption, and porous borders.
Key Risks
Poor Regulation and Weak Institutions
- Suriname’s weak regulatory environment makes it a prime target for money laundering and financial crimes (Transparency International).
- The former governor of its central bank and finance minister were indicted for financial crimes totaling $200 million.
- Corruption is rampant at all levels of government, with former President Desi Bouterse convicted of murder and drug trafficking and still wielding significant influence.
Corruption
- According to Transparency International’s Corruption Perceptions Index, Suriname ranks as one of the most corrupt countries in the world.
- Widespread corruption is a significant risk factor for financial crimes, as criminal proceeds are often laundered through the country.
Drug Trafficking
- Suriname is a crucial transit country for cocaine moving from South America to Europe via the Netherlands.
- The former head of its anti-terror unit was arrested in a US court on drug trafficking charges and allegedly funneling profits to Hezbollah.
Mineral Trafficking
- Gold is Suriname’s largest export, accounting for nearly 80% of its trade and generating more than $2 billion annually.
- Mineral trafficking is a significant risk due to endemic corruption and non-existent regulation.
Porous Borders
- Suriname’s borders with Brazil and Guyana allow for easy smuggling of illegal gold and cocaine.
- Used cars are another method of transaction-based laundering.
AML Policy and Regulations
Poor Implementation
- Despite having updated anti-corruption laws and AML statutes, Suriname lacks the political will and resources to effectively tackle money laundering and related crimes.
Banking Sector Weaknesses
- Suriname’s banking sector is a significant flaw in its AML efforts. Banks are reluctant to prioritize compliance over profits and lack the necessary expertise to combat money laundering.
AML Vulnerabilities
Lawyers, Notaries, and Car Dealers
- Professionals such as lawyers, notaries, and car dealers are key facilitators of money laundering in Suriname.
Illega Activities in Plain Sight
- Drug and mineral trafficking occur openly in Suriname, with large container ships transporting vast quantities of illegal goods.
Tax Authority Corruption
- The gold export tax authority’s blatant corruption highlights the depth of corruption in Suriname.
Terrorist Financing
- Suriname’s failure to address money laundering and related financial crimes leaves it susceptible to terrorist financing.
Strengths
Limited Progress
- A national risk assessment was concluded in 2021 but remains confidential due to government inaction.
- The previous government, led by convicted murderer and drug trafficker Desi Bouterse, continues to exert significant influence in Chan Santokhi’s new administration.
Conclusion
Suriname’s weak regulatory environment, rampant corruption, and porous borders make it a prime target for financial crimes, including money laundering and drug trafficking. Despite having updated laws, Suriname lacks the political will and resources to effectively tackle these crimes, leaving it susceptible to terrorist financing. Professionals, such as lawyers, notaries, and car dealers, as well as illegally obtained gold and used cars, are key vulnerabilities in this weak regulatory landscape.
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