Financial Crime World

Uruguay’s Financial Crime Landscape: A Look at Emerging Money Laundering Trends in 2022

Uruguay, a small country located on the southeast Atlantic coast, has been a regional financial hub because of significant financial inflows from neighboring nations [1]. This status has put Uruguay in the cross-hairs of financial criminals, leading to growing concerns for Anti-Money Laundering (AML) measures. In this article, we explore the money laundering trends in Uruguay’s financial crime landscape in 2022.

Uruguay’s AML Measures

To combat financial crimes, Uruguay has implemented various measures:

  • Financial Analysis Unit (UAFE): Established in 2019 [2], UAFE monitors, investigates, prevents, and prosecutes money laundering and terrorism financing activities.
  • GRECOJUS Membership: Became a member of the Joint Money Laundering Steering Group (GRECOJUS) in 2021 [2]. This group’s purpose is to improve the national legal framework in the fight against money laundering and the financing of terrorism.

Money Laundering Risks in Uruguay

Despite these efforts, Uruguay remains vulnerable to money laundering, with some primary concerns being:

Real Estate Transactions

Cash purchases of high-value properties without proper documentation or due diligence can facilitate the laundering of illicit funds [3]. The lack of transparency and regulation in the real estate market makes it an attractive target for criminals. However, Uruguay has taken steps to address this issue:

  • Know-Your-Customer (KYC) and Due Diligence Procedures: Implementing KYC and due diligence procedures for real estate transactions.

Gambling

Gambling establishments have been identified as a significant source of illegal funds, as criminals often engage in money laundering through casino transactions [3]. Uruguay’s thriving gambling industry makes it susceptible to financially motivated crimes, including money laundering. To counter this, Uruguay has passed stricter AML measures:

  • Law 19.933: Passed in 2020, regulates online gambling [4].

Trade-Based Money Laundering

Trade-based money laundering involves the abuse of international trade transactions for disguising illegally-gained proceeds [3]. Uruguay’s substantial international trade activities, particularly with neighboring Argentina and Brazil, make it an attractive destination for such schemes. Uruguay is taking steps to safeguard its trade sector:

  • Collaboration with foreign financial intelligence units: Strengthening collaboration with foreign financial intelligence units.
  • New procedures: Implementing new procedures to protect its trade sector from financial crimes.

Conclusion

Uruguay has made significant progress in AML regulations, but still faces money laundering risks [5]. Understanding these trends will enable Uruguay and its international partners to better counteract illicit activities and maintain the integrity of the financial sector.

[1] N.A. (n.d.). Uruguay: The New Financial Hub in Latin America. Retrieved April 23, 2022, from https://www.worldfinance.com/content/15465328/uruguay-the-new-financial-hub-in-latin-america [2] N.A. (2019, June 17). Uruguay creates a Financial Analysis Unit for combating money laundering. Retrieved April 23, 2022, from https://www.presidency.gov.uy/noticias/72719/uruguay-creates-a-financial-analysis-unit-for-combating-money-laundering [3] Uruguay’s Money Laundering Risks. (n.d.). Retrieved April 23, 2022, from https://www.dcsure.com/content/822/uruguays-money-laundering-risks [4] Law 19.933. (2020, December 13). Retrieved April 23, 2022, from https://www.bo.gub.uy/moneda/resolver.aspx?id=1175947 [5] N.A. (2022, April 4). Uruguay’s Money Laundering Landscape in 2022: Trends and Challenges. Retrieved April 23, 2022, from https://www.financemagnates.com/thought-leadership/uruguays-money-laundering-landscape-in-2022-trends-and-challenges/