ANTIGUA
SUMMARY

Sanctions

None

FAFT AML Deficient

No

Higher Risk Areas

 

Non - Compliance with FATF 40 + 9 Recommendations

US Dept of State Money Laundering Assessment

Not on EU White list equivalent jurisdictions

Offshore Finance Centre

Medium Risk Areas

Failed States Index (Political Issues)(Average Score)

 

 

ANTI-MONEY LAUNDERING

 

FATF Status

Antigua & Barbuda is no longer on the FATF List of Countries that have been identified as having strategic AML deficiencies

 

FATF Statement: 14 February 2014

The FATF welcomes Antigua and Barbuda’s significant progress in improving its AML/CFT regime and notes that Antigua and Barbuda has established the legal and regulatory framework to meet its commitments in its action plan regarding the strategic deficiencies that the FATF had identified in February 2010. Antigua and Barbuda is therefore no longer subject to FATF’s monitoring process under its on-going global AML/CFT compliance process. Antigua and Barbuda will work with CFATF as it continues to address the full range of AML/CFT issues identified in its mutual evaluation report.

 

Compliance with FATF Recommendations

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Antigua & Barbuda was undertaken by the Financial Action Task Force (FATF) in 2009. According to that Evaluation, Antigua & Barbuda was deemed Compliant for 6 and Largely Compliant for 8 of the FATF 40 + 9 Recommendations. It was Partially Compliant or Non-Compliant for all 6 of the Core Recommendations.

 

US Department of State Money Laundering assessment (INCSR)

Antigua and Barbuda is categorised by the US State Department as a Country/Jurisdiction of Primary Concern in respect of Money Laundering and Financial Crimes.

OVERVIEW

 

Antigua and Barbuda is an offshore center which continues to be vulnerable to money laundering and other financial crimes. Its relatively large financial sector and internet gaming industry add to its susceptibility. Antigua and Barbuda also operates a Citizenship by Investment Program (CIP) that increases its susceptibility to money laundering and other financial crimes. Antigua and Barbuda is a transit point for illegal drugs going to the United States and Europe. According to the Antiguan Office of National Drug Control and Money Laundering Policy (ONDCP), the collaborative efforts between Antigua and Barbuda and U.S. law enforcement agencies have brought about a decrease in drug trafficking activity.

 

VULNERABILITIES AND EXPECTED TYPOLOGIES

 

Money laundering, narcotics trafficking, gaming, and firearms trafficking are major sources of illicit funds in the country. Funds are laundered through the purchase of real estate, vehicles, vessels, and jewelry as well as through a variety of businesses.

 

The CIP remains among the most lax in the world. An individual is eligible for economic citizenship with a $400,000 minimum investment in real estate, a contribution to the National Development Fund of $200,000, or a $1.5 million approved business investment. Applicants must make a source of funds declaration and provide evidence supporting the declaration. The government established a Citizenship by Investment Unit (CIU) to manage the screening and application process. The CIU does not maintain adequate autonomy from politicians to prevent political interference in its decisions.

Shell companies are not permitted in Antigua and Barbuda. International companies are authorized to possess bearer shares; however, the license application requires disclosure of the names and addresses of directors (who must be natural persons), the activities the corporation intends to conduct, the names of shareholders, and number of shares they will hold. Registered agents or service providers are compelled by law to know the names of beneficial owners. Offshore financial institutions are exempt from corporate income tax.

 

ONDCP has a four-pronged approach to combatting narcotics trafficking and money laundering via the reporting of financial intelligence and investigation, AML/CFT compliance, anti-drug strategy, and counternarcotics operations. The Royal Police Force of Antigua and Barbuda is also responsible for investigating drug trafficking, money laundering, terrorist financing, and other financial crimes.

 

KEY AML LAWS AND REGULATIONS

 

Casinos and internet gaming maintain a strong presence in Antigua and Barbuda. The Financial Services Regulatory Commission (FSRC) regulates internet gaming companies, and the ONDCP maintains records of payouts over $25,000 (also reported to the FSRC). Regulations require internet gaming companies to incorporate as IBCs and the majority of individuals in key management positions to maintain a physical presence on the island. Additionally, domestic casinos must incorporate as domestic corporations.

 

The following entities must comply with CDD rules: banks, international offshore banking businesses, venture risk capital providers, and money transmission services; entities offering financial services, foreign exchange, financial and commodities-based derivative instruments, or transferable or negotiable instruments; money brokers and exchanges, money lenders, and pawn shops; real property businesses; credit unions, building societies, and trust businesses; dealers in precious metals, art, jewelry, and high-value goods; casinos and providers of internet gaming and sports betting; car dealerships; travel agents; company service providers, attorneys, notaries, and accountants.

 

AML DEFICIENCIES

 

Antigua and Barbuda has largely achieved technical compliance with international AML standards. The government has prosecuted few cases of money laundering and official corruption, and reports of corruption are endemic.

 

ENFORCEMENT/IMPLEMENTATION ISSUES AND COMMENTS

 

Antigua and Barbuda continues to work to improve its AML regime. The Proceeds of Crime Amendment Act of 2014 introduces civil forfeiture provisions in Antigua and includes amendments to improve the consistency of the provisions relating to criminal confiscation.

 

Antigua and Barbuda recorded its first successful confiscation case under the Proceeds of Crime Act in October 2015. The ONDCP first arrested two persons with over 160 kilograms of cocaine aboard a sailing vessel. The Court ordered the defendant to pay the amount of $30,000 to the government after learning he had forfeitable assets.

 

ONDCP froze the operations of the European Federal Credit Bank of Antigua (Eurofed), a bank connected to the former Prime Minister of Ukraine, Pavlo Lazarenko, on the grounds that it had been obtained through acts of corruption committed during his time in power in Ukraine. In 2016, $66.7 million in frozen assets were transferred to the government’s Forfeiture Fund, which the government appropriated, not all of which was included on the official budget.

 

In 2016, U.S. prosecutors alleged that government officials from Antigua and Barbuda participated in a corruption scandal involving the payout of close to $8 million in bribes by Brazilian construction contractor Odebrecht. The corruption allegations involve two high-level officials and two offshore banks in Antigua and Barbuda. Antigua and Barbuda continues to investigate allegations of money laundering.

 

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SANCTIONS

There are no international sanctions currently in force against this country.

 

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BRIBERY & CORRUPTION

 

Index

Rating (100-Good / 0-Bad)

Transparency International Corruption Index

N/A

World Governance Indicator – Control of Corruption

75

 

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INVESTMENT CLIMATE - Executive Summary (US State Department)

Antigua and Barbuda’s economy is expected to grow by 1.8% in 2014. Antigua and Barbuda completed and exited a three-year Standby Agreement with the International Monetary Fund in 2013. Recent improvements in fiscal management are leading to economic recovery, particularly coupled with the uptick of tourist arrivals.

The government is pursuing investment in niche markets, particularly tourism, international financial services, offshore education, agro-processing, light manufacturing, real estate & construction and information & communication technology (ICT).

Companies registered in Antigua and Barbuda have the right to repatriate all capital, royalties, dividends and profits free of all taxes or any other charges on foreign exchange transactions.

The United States and Antigua and Barbuda are both parties to the World Trade Organization (WTO). The WTO Dispute Settlement Panel and Appellate Body resolve disputes over WTO agreements, while courts of appropriate jurisdiction in both countries resolve private disputes. The United States and Antigua and Barbuda brought a case before the WTO, and the WTO ruled in favor of Antigua and Barbuda.

Foreign investors may hold up to 100% of an investment, and the entrepreneur needs 26 days from start to finish to transfer the title on a piece of property. The government of Antigua & Barbuda owns 55% of the land in Antigua. The remaining 45% is privately owned. Currently, land ownership is prohibited on the island of Barbuda.

Antigua and Barbuda bases its legal system on the British common law system. There is one ongoing dispute regarding expropriation of an American-owned property, for which the government has not paid compensation for many years despite a court ruling in favor of the American.

Antigua and Barbuda has bilateral investment treaties with Germany and the United Kingdom. Antigua and Barbuda has also signed free trade agreements with Costa Rica and the Dominican Republic but the agreements have not entered into force. Antigua and Barbuda has double taxation agreements with Denmark, Norway, Sweden, and the United Kingdom.

 

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