Suriname’s Financial Crime Epidemic: Money Laundering, Corruption, and Drug Trafficking Thrive Amid Porous Borders
In the intricate world of financial crimes in Latin America and the Caribbean, recognizing the distinct challenges and risks of each jurisdiction is imperative for robust anti-money laundering (AML) compliance. In this article, we delve deeper into Suriname’s financial crime landscape and highlight the prevailing risks for organizations when evaluating customer, geographic, or matter risk. For a more detailed analysis of AML risks and complexities in this region, download our free guide to compliance.
Key Risks in Suriname
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Weak regulation and government corruption: Suriname is often referred to as a ‘money launderers paradise.’ With limited regulations, weak institutions, and limited technical capacity, this country poses a significant AML risk. Several high-profile financial crimes involving the governor of the central bank and finance minister serve as stark reminders of the issue.
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Endemic corruption: Corruption is the most prevalent financial crime in Suriname. Ministers and political leaders have been implicated in numerous scandals. The former president has been convicted of murder and drug trafficking and remains influential within the current administration. Patronage networks are deeply embedded within the socio-political fabric.
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Drug trafficking: Suriname is a significant transit country and broker for cocaine moving from Colombia and Venezuela to Europe, notably the Netherlands (Suriname’s former colonial power). The former head of the anti-terror unit was convicted of drug trafficking and routing profits to Hezbollah in a US court.
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Mineral trafficking: With gold being Suriname’s largest export, mineral trafficking poses a significant risk. Endemic corruption and the absence of regulation exacerbate the issue.
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Porous borders: The lack of border control with Brazil and Guyana makes it easy for illegal gold and drugs to be smuggled.
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Used cars: Used cars imported from other countries are a common method for transaction-based money laundering.
Criminal Proceeds
An estimated $56 million to $139 million is laundered annually in Suriname.
AML Policy Summary in Suriname
Despite having updated anti-corruption laws and money laundering statutes, Suriname has a minimal political will to address money laundering or criminal activity, with pervasive corruption at all levels of government.
Legal Summary
Convicted criminals freely operate within the government, and there is no effective Anti-Corruption Commission in place, with weak enforcement of existing money laundering laws.
Key Weaknesses in Suriname’s AML Regime
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The banking sector: Known for prioritizing profits over compliance, and lacking the technical capacity to counter money laundering, poses a considerable risk for Suriname’s isolation from the international financial system.
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Lawyers, notaries, and car dealers: Acting as key facilitators for money laundering and lacking transparency and oversight.
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Currency exchanges: Completely unregulated, and supermarkets even serve as currency dealers create a significant gap in Suriname’s regulatory framework.
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Fintech, DNFBPS, and the jewelry industry: Untested and relatively unregulated sectors carry a substantial risk for money laundering.
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Drug and mineral trafficking: Perpetrated openly in the country, with drug and mineral trading happening in plain sight, and Suriname acting as a black market transit hub for wholesale buyers and sellers.
Strengths in Suriname’s AML Regime
A national risk assessment was completed in 2021; however, the document is confidential, and there is little hope for government action. The Desi Bouterse government, led by a convicted murderer and drug trafficker, continues to wield significant power in the new Chan Santokhi administration.
Additional Resources
VinciWorks has prepared a comprehensive guide to support businesses currently operating in Latin America and the Caribbean, as well as those planning to enter or expand to new countries in this region. The guide offers an overview of critical AML challenges and issues, as well as a country-by-country assessment of AML risks and laws.