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Puerto Rico gov’t: European countries reject new inclusions in dirty money list

By on March 4, 2019

The executive director of the Fiscal Agency and Financial Advisory Authority of Puerto Rico, Christian Sobrino Vega (Courtesy)

SAN JUAN – The executive director of the Fiscal Agency and Financial Advisory Authority of Puerto Rico (Aafaf by its Spanish acronym), Christian Sobrino Vega, and the island’s Financial Institutions (OCIF by its Spanish acronym) commissioner, George Joyner, said Monday that 27 of the 28 member countries of the European Union objected to finalize the list of high-risk jurisdictions for money laundering recently published by the European Commission (EC).

The list included several U.S. territories, among them, Guam, Virgin Islands, Puerto Rico and American Samoa. It was also rejected by the U.S. Treasury Department, which said the EC’s methodology lacked rigor.

“Currently, Puerto Rico has a robust legal and regulatory framework to prevent, detect and combat money laundering and other illegal financial practices,” the Puerto Rico government’s release reads. AAFAF and OCIF stress that their collaboration with the Office of Terrorist Financing and Financial Crimes (TFFC) of the U.S. Treasury is ongoing.

Sobrino and Joyner thanked the U.S. Treasury for supporting the Government of Puerto Rico for voicing its rejection to the EC list.

“It is expected that at its next meeting on March 7, 2019, the European Council of the European Union will ratify the rejection of the list published a few weeks ago by the European Commission,” the commonwealth government said.

The U.S. Treasury had said in a statement that it considers the Financial Action Task Force (FATF) as the entity in charge of developing global standards to combat Anti-Money Laundering and Countering the Financing of Terror (AML/CFT).

It then said the commission’s process contrasts with the FATF’s in that it “did not include a sufficiently in-depth review,” provided the “affected jurisdictions with only a cursory basis for its determination,” notified these they would be included on the list “only days before issuance” and “failed to provide” them ” with any meaningful opportunity to challenge their inclusion or otherwise address issues identified by the Commission.”

Treasury rejected the inclusion of the territories on the list, saying “the commitments and actions of the United States in implementing the FATF standards extend to all U.S. territories, and that the same Anti-Money Laundering and Countering the Financing of Terror (AML/CFT) legal framework that applies to the continental United States also generally applies to U.S. territories.”

The agency concluded its statement saying it “does not expect U.S. financial institutions to take the European Commission’s list into account in their AML/CFT policies and procedures.”

Besides the four U.S. territories, Panama and Saudi Arabia, whose king personally wrote to European Unions in protest, would have been alongside 16 jurisdictions that include Iran, Iraq, Pakistan, Ethiopia and North Korea.

The list warns European banks to closely monitor its transactions with the listed countries.

Local Banking Industry Denounces P.R.’s Inclusion in Laundering Blacklist

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