|
Sanctions:
None applicable
____________________________________________________
Offshore Jurisdiction Blacklists
As a recognised offshore finance jurisdiction this country may fall
under various country offshore jurisdiction blacklists.
____________________________________________________
US State Department Money Laundering Report - 2011
Aruba is not considered a regional financial center but has sought
to diversify its economy by developing offshore activities through
the limited licensing of offshore banks and companies. These
offshore vehicles pose risks for misuse by money launderers and
tax evaders. Because of its location, Aruba is a transshipment
point for drugs from South America bound for the United States
and Europe and the transshipment of currency in the reverse
direction. Money laundering is primarily related to proceeds from
illegal narcotics. Other sources of illicit proceeds include revenue
from tax offenses, public corruption and the offshore financial
sector. Bulk cash smuggling is a continuing problem due to the
close proximity of Aruba to South America.
Aruba has three free economic zones. It is believed
“contrabanding” (using smuggled bulk cash to buy products which
are shipped to South America and sold) could be a problem.
There are at least eleven casinos, and online gaming is allowed.
Bearer shares are permitted, but legislation is being considered to
both ban future issuance and phase out existing shares.
DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY
TRANSACTIONS RELATED TO INTERNATIONAL NARCOTICS
TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS OF US
CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN
THE U.S.; OR THAT OTHERWISE SIGNIFICANTLY AFFECT THE
U.S.: NO
CRIMINALIZATION OF MONEY LAUNDERING:
“All serious crimes” approach or “list” approach to predicate
crimes: All serious crimes
Legal persons covered: criminally: YES civilly: Not available
CRIMINALIZATION OF TERRORIST FINANCING:
Ability to freeze terrorist assets without delay: YES
UN lists of designated terrorists or terrorist entities distributed to
financial institutions: YES
KNOW-YOUR-CUSTOMER RULES:
Covered entities: Banks, life insurance companies, money transfer
companies, lawyers, civil notaries, accountants, tax advisors,
casinos, dealers in jewels and precious metals, realtors and high-
worth dealers in art, antiques, vehicles, aircraft and ships
Enhanced due diligence procedures for PEPs: Foreign: YES
Domestic: YES
SUSPICIOUS TRANSACTION REPORTING REQUIREMENTS:
Covered entities: Banks, life insurance companies, money transfer
companies, lawyers, civil notaries, accountants, tax advisors,
casinos, dealers in jewels and precious metals, realtors and high-
worth dealers in art, antiques, vehicles, aircraft and ships
Number of STRs received and time frame: 4,931 from January –
November 2010
Number of CTRs received and time frame: Not available
MONEY LAUNDERING CRIMINAL
PROSECUTIONS/CONVICTIONS:
Prosecutions: Not available
Convictions: Not available
Assets forfeited: criminally: Not available civilly: Not available
RECORDS EXCHANGE MECHANISM:
With U.S.: YES
With other governments/jurisdictions: YES
Aruba is a member of the Caribbean Financial Action Task Force,
(CFATF), a Financial Action Task Force-style regional body. Its
most recent mutual evaluation can be found here: http://www.cfatf-
gafic.org/mutual-evaluation-reports.html
ENFORCEMENT AND IMPLEMENTATION ISSUES AND
COMMENTS:
Aruba continues to work on the improvement of its AML/CFT
framework. It should be noted that Aruba’s efforts are coordinated
by the AML/CFT Strategy Group, chaired by the Prime Minister,
which has met regularly and ensures a high level political
commitment. Various important legislative changes have been
introduced, such as the independent criminalization of terrorist
financing, the introduction of an asset freezing regime, and the
designation of the Central Bank of Aruba (CBA) as the sole
supervisory authority for AML/CFT matters. On March 5, 2010,
Aruba modified the Criminal Code of Aruba to include an article
criminalizing terrorist financing as a separate and independent
offense. Also, based on the Sanctions State Decree to Combat
Terrorism and Terrorist Financing, which entered into force on
June 25, 2010, Aruba is able to freeze terrorist assets in a timely
manner. In addition, authorities are working on a new and
comprehensive state ordinance on the application of customer
due diligence and the reporting of unusual transactions by
financial institutions and designated non-financial businesses and
professions. The CBA has created a separate Integrity Unit with
additional staff that will focus specifically on AML/CFT-related
issues, while the financial intelligence unit (FIU) has hired
additional staff. Furthermore, the Public Prosecutor’s Office now
has more prosecutors available to properly carry out its tasks.
Banks or other financial institutions regulated by the CBA, except
for trust company service providers, are allowed to issue bearer
shares. However, all persons or entities holding 5% or more of the
issued shares or voting rights must obtain prior written approval
from the CBA for such shareholding. Thus, all persons or entities
with such holdings are identified and subject to the fit and proper
criteria laid down in the supervisory laws. Legislation has been
drafted to ban the issuance of new bearer shares while phasing
out existing bearer shares over a fixed period of time. This new
legislation is expected to be enacted in 2011.
With regard to the non-profit sector, a quick scan of this sector
was performed in 2010 to determine the sector’s size, the type of
non-profit organizations present, and the scope of their activities,
in order to assess the measures necessary to properly regulate
the sector.
Aruba’s money laundering laws do not cover proceeds generated
from counterfeiting and piracy of products, insider trading and
market manipulation, many types of environmental crimes, or
fraud. Aruba does not have a suspicious transactions reporting
system, but a broader unusual transactions reporting (UTR)
system.
Pursuant to a change in the relevant legislation, as of July 1,
2010, travelers carrying checks, gift cards, and other goods worth
more than $11,000, that could be converted easily to cash, are
obliged to declare their possession at Customs. Credit and debit
cards are exempted from the new legislation.
The Kingdom of the Netherlands, of which Aruba is an
autonomous constituent part, extended the application to Aruba of
the 1988 UN Drug Convention in 1999; the UN International
Convention for the Suppression of the Financing of Terrorism in
2005; and the UN Convention against Transnational Organized
Crime in 2007. The Kingdom has not yet extended the application
of the UN Convention against Corruption to Aruba.
____________________________________________________
US State Dept Narcotics Report 2012 (introduction):
Aruba, Curaçao, and Dutch St. Maarten have a high degree of
autonomy over their internal affairs, with the right to exercise
independent decision making in a number of counternarcotics
areas. The Kingdom of the Netherlands is responsible for the
defense and foreign affairs of all the constituent countries,
including the Caribbean parts of the Kingdom, and assists the
Governments of Aruba, Curaçao, Dutch St. Maarten, and the BES
islands in their efforts to combat narcotics trafficking.
The Dutch Caribbean did not adopt any new laws or initiate any
new counternarcotics programs in 2011. The Kingdom of the
Netherlands has notified the United Nations as well as the United
States that the modification of the structure of the Kingdom on
October 10, 2010 (when the Netherlands Antilles ceased to exist)
would not affect the validity of international agreements ratified by
the Kingdom before that date and as described below.
The Netherlands extended the 1988 UN Convention against Illicit
Traffic in Narcotic Drugs and Psychotropic Substances ("Vienna
Convention") to the former Netherlands Antilles and Aruba in
March 1999, with the limitation that its obligations under certain
provisions would only be applicable in so far as they were in
accordance with former Netherlands Antilles and Aruba criminal
legislation and policy on criminal matters. The obligations of the
Netherlands as a party to the 1961 UN Single Convention on
Narcotic Drugs, as amended by the 1972 Protocol, applied to the
former Netherlands Antilles and Aruba upon accession. The
Netherlands extended the UN Convention against Transnational
Organized Crime and its three Protocols to Aruba in 2007 and
extended the 1971 UN Convention on Psychotropic Substances to
the former Netherlands Antilles in 1999.
The Netherlands’ 1981 Mutual Legal Assistance Treaty (MLAT)
with the United States applied to the former Netherlands Antilles
and Aruba, although the new United States-Netherlands Mutual
Legal Assistance Agreement does not. Both Aruba and the former
Netherlands Antilles have routinely honored requests made under
the MLAT and cooperate extensively with the United States on law
enforcement matters at less formal levels. The 2004 United
States-Netherlands Extradition Agreement and its Annex does
apply to the Dutch Caribbean; and both the former Netherlands
Antilles and Aruba have been extremely cooperative in extraditing
drug traffickers to the United States. In addition, the former
Netherlands Antilles and Aruba adopted the Agreement
Regarding Mutual Cooperation in the Tracing, Freezing, Seizure
and Forfeiture of the Proceeds and Instrumentalities of Crime and
the Sharing of Forfeited Assets, which was signed by the
Government of the Netherlands in 1994.
The DEA’s Curaçao Country Office considers the Korps Politie
Aruba (KPA) to be one of the most effective regional partners in
the fight against narcotics trafficking. The KPA is a highly
professional and motivated police agency that conducted several
successful drug trafficking investigations in 2011 targeting
trafficking organizations that were receiving multi-kilogram
quantities of cocaine from supply sources located on the north
coast of Colombia.
For Full report, click here
____________________________________________________
US State Dept Trafficking in Persons Report 2011
(introduction):
(Tier 2)*
Aruba is primarily a destination for women and men subjected to
sex trafficking and forced labor. Those at greatest risk of
trafficking are foreign women in Aruba’s commercial sex trade and
foreign men and women in the service and construction
industries. Also at risk are Chinese men and women working in
supermarkets as well as Indian men in the jewelry sector, and
Caribbean and South American women in domestic service. There
are indications of past instances of Aruban children under 18 in
prostitution in Aruba.
The Government of Aruba does not fully comply with the minimum
standards for the elimination of trafficking; however, it is making
significant efforts to do so. The government has not yet
successfully prosecuted any trafficking offenders to date, though
the Aruban anti-trafficking coordinator has demonstrated
outstanding leadership in advancing the government’s response
to human trafficking during her short time in office, and the
government initiated several complex prosecutions during the
reporting season. The government also showed improved efforts
in the area of victim protection, primarily officials’ increased victim
identification measures.
For full report click here
____________________________________________________
US State Dept Terrorism Report 2009
No report available
None applicable
____________________________________________________
Offshore Jurisdiction Blacklists
As a recognised offshore finance jurisdiction this country may fall
under various country offshore jurisdiction blacklists.
____________________________________________________
US State Department Money Laundering Report - 2011
Aruba is not considered a regional financial center but has sought
to diversify its economy by developing offshore activities through
the limited licensing of offshore banks and companies. These
offshore vehicles pose risks for misuse by money launderers and
tax evaders. Because of its location, Aruba is a transshipment
point for drugs from South America bound for the United States
and Europe and the transshipment of currency in the reverse
direction. Money laundering is primarily related to proceeds from
illegal narcotics. Other sources of illicit proceeds include revenue
from tax offenses, public corruption and the offshore financial
sector. Bulk cash smuggling is a continuing problem due to the
close proximity of Aruba to South America.
Aruba has three free economic zones. It is believed
“contrabanding” (using smuggled bulk cash to buy products which
are shipped to South America and sold) could be a problem.
There are at least eleven casinos, and online gaming is allowed.
Bearer shares are permitted, but legislation is being considered to
both ban future issuance and phase out existing shares.
DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY
TRANSACTIONS RELATED TO INTERNATIONAL NARCOTICS
TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS OF US
CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN
THE U.S.; OR THAT OTHERWISE SIGNIFICANTLY AFFECT THE
U.S.: NO
CRIMINALIZATION OF MONEY LAUNDERING:
“All serious crimes” approach or “list” approach to predicate
crimes: All serious crimes
Legal persons covered: criminally: YES civilly: Not available
CRIMINALIZATION OF TERRORIST FINANCING:
Ability to freeze terrorist assets without delay: YES
UN lists of designated terrorists or terrorist entities distributed to
financial institutions: YES
KNOW-YOUR-CUSTOMER RULES:
Covered entities: Banks, life insurance companies, money transfer
companies, lawyers, civil notaries, accountants, tax advisors,
casinos, dealers in jewels and precious metals, realtors and high-
worth dealers in art, antiques, vehicles, aircraft and ships
Enhanced due diligence procedures for PEPs: Foreign: YES
Domestic: YES
SUSPICIOUS TRANSACTION REPORTING REQUIREMENTS:
Covered entities: Banks, life insurance companies, money transfer
companies, lawyers, civil notaries, accountants, tax advisors,
casinos, dealers in jewels and precious metals, realtors and high-
worth dealers in art, antiques, vehicles, aircraft and ships
Number of STRs received and time frame: 4,931 from January –
November 2010
Number of CTRs received and time frame: Not available
MONEY LAUNDERING CRIMINAL
PROSECUTIONS/CONVICTIONS:
Prosecutions: Not available
Convictions: Not available
Assets forfeited: criminally: Not available civilly: Not available
RECORDS EXCHANGE MECHANISM:
With U.S.: YES
With other governments/jurisdictions: YES
Aruba is a member of the Caribbean Financial Action Task Force,
(CFATF), a Financial Action Task Force-style regional body. Its
most recent mutual evaluation can be found here: http://www.cfatf-
gafic.org/mutual-evaluation-reports.html
ENFORCEMENT AND IMPLEMENTATION ISSUES AND
COMMENTS:
Aruba continues to work on the improvement of its AML/CFT
framework. It should be noted that Aruba’s efforts are coordinated
by the AML/CFT Strategy Group, chaired by the Prime Minister,
which has met regularly and ensures a high level political
commitment. Various important legislative changes have been
introduced, such as the independent criminalization of terrorist
financing, the introduction of an asset freezing regime, and the
designation of the Central Bank of Aruba (CBA) as the sole
supervisory authority for AML/CFT matters. On March 5, 2010,
Aruba modified the Criminal Code of Aruba to include an article
criminalizing terrorist financing as a separate and independent
offense. Also, based on the Sanctions State Decree to Combat
Terrorism and Terrorist Financing, which entered into force on
June 25, 2010, Aruba is able to freeze terrorist assets in a timely
manner. In addition, authorities are working on a new and
comprehensive state ordinance on the application of customer
due diligence and the reporting of unusual transactions by
financial institutions and designated non-financial businesses and
professions. The CBA has created a separate Integrity Unit with
additional staff that will focus specifically on AML/CFT-related
issues, while the financial intelligence unit (FIU) has hired
additional staff. Furthermore, the Public Prosecutor’s Office now
has more prosecutors available to properly carry out its tasks.
Banks or other financial institutions regulated by the CBA, except
for trust company service providers, are allowed to issue bearer
shares. However, all persons or entities holding 5% or more of the
issued shares or voting rights must obtain prior written approval
from the CBA for such shareholding. Thus, all persons or entities
with such holdings are identified and subject to the fit and proper
criteria laid down in the supervisory laws. Legislation has been
drafted to ban the issuance of new bearer shares while phasing
out existing bearer shares over a fixed period of time. This new
legislation is expected to be enacted in 2011.
With regard to the non-profit sector, a quick scan of this sector
was performed in 2010 to determine the sector’s size, the type of
non-profit organizations present, and the scope of their activities,
in order to assess the measures necessary to properly regulate
the sector.
Aruba’s money laundering laws do not cover proceeds generated
from counterfeiting and piracy of products, insider trading and
market manipulation, many types of environmental crimes, or
fraud. Aruba does not have a suspicious transactions reporting
system, but a broader unusual transactions reporting (UTR)
system.
Pursuant to a change in the relevant legislation, as of July 1,
2010, travelers carrying checks, gift cards, and other goods worth
more than $11,000, that could be converted easily to cash, are
obliged to declare their possession at Customs. Credit and debit
cards are exempted from the new legislation.
The Kingdom of the Netherlands, of which Aruba is an
autonomous constituent part, extended the application to Aruba of
the 1988 UN Drug Convention in 1999; the UN International
Convention for the Suppression of the Financing of Terrorism in
2005; and the UN Convention against Transnational Organized
Crime in 2007. The Kingdom has not yet extended the application
of the UN Convention against Corruption to Aruba.
____________________________________________________
US State Dept Narcotics Report 2012 (introduction):
Aruba, Curaçao, and Dutch St. Maarten have a high degree of
autonomy over their internal affairs, with the right to exercise
independent decision making in a number of counternarcotics
areas. The Kingdom of the Netherlands is responsible for the
defense and foreign affairs of all the constituent countries,
including the Caribbean parts of the Kingdom, and assists the
Governments of Aruba, Curaçao, Dutch St. Maarten, and the BES
islands in their efforts to combat narcotics trafficking.
The Dutch Caribbean did not adopt any new laws or initiate any
new counternarcotics programs in 2011. The Kingdom of the
Netherlands has notified the United Nations as well as the United
States that the modification of the structure of the Kingdom on
October 10, 2010 (when the Netherlands Antilles ceased to exist)
would not affect the validity of international agreements ratified by
the Kingdom before that date and as described below.
The Netherlands extended the 1988 UN Convention against Illicit
Traffic in Narcotic Drugs and Psychotropic Substances ("Vienna
Convention") to the former Netherlands Antilles and Aruba in
March 1999, with the limitation that its obligations under certain
provisions would only be applicable in so far as they were in
accordance with former Netherlands Antilles and Aruba criminal
legislation and policy on criminal matters. The obligations of the
Netherlands as a party to the 1961 UN Single Convention on
Narcotic Drugs, as amended by the 1972 Protocol, applied to the
former Netherlands Antilles and Aruba upon accession. The
Netherlands extended the UN Convention against Transnational
Organized Crime and its three Protocols to Aruba in 2007 and
extended the 1971 UN Convention on Psychotropic Substances to
the former Netherlands Antilles in 1999.
The Netherlands’ 1981 Mutual Legal Assistance Treaty (MLAT)
with the United States applied to the former Netherlands Antilles
and Aruba, although the new United States-Netherlands Mutual
Legal Assistance Agreement does not. Both Aruba and the former
Netherlands Antilles have routinely honored requests made under
the MLAT and cooperate extensively with the United States on law
enforcement matters at less formal levels. The 2004 United
States-Netherlands Extradition Agreement and its Annex does
apply to the Dutch Caribbean; and both the former Netherlands
Antilles and Aruba have been extremely cooperative in extraditing
drug traffickers to the United States. In addition, the former
Netherlands Antilles and Aruba adopted the Agreement
Regarding Mutual Cooperation in the Tracing, Freezing, Seizure
and Forfeiture of the Proceeds and Instrumentalities of Crime and
the Sharing of Forfeited Assets, which was signed by the
Government of the Netherlands in 1994.
The DEA’s Curaçao Country Office considers the Korps Politie
Aruba (KPA) to be one of the most effective regional partners in
the fight against narcotics trafficking. The KPA is a highly
professional and motivated police agency that conducted several
successful drug trafficking investigations in 2011 targeting
trafficking organizations that were receiving multi-kilogram
quantities of cocaine from supply sources located on the north
coast of Colombia.
For Full report, click here
____________________________________________________
US State Dept Trafficking in Persons Report 2011
(introduction):
(Tier 2)*
Aruba is primarily a destination for women and men subjected to
sex trafficking and forced labor. Those at greatest risk of
trafficking are foreign women in Aruba’s commercial sex trade and
foreign men and women in the service and construction
industries. Also at risk are Chinese men and women working in
supermarkets as well as Indian men in the jewelry sector, and
Caribbean and South American women in domestic service. There
are indications of past instances of Aruban children under 18 in
prostitution in Aruba.
The Government of Aruba does not fully comply with the minimum
standards for the elimination of trafficking; however, it is making
significant efforts to do so. The government has not yet
successfully prosecuted any trafficking offenders to date, though
the Aruban anti-trafficking coordinator has demonstrated
outstanding leadership in advancing the government’s response
to human trafficking during her short time in office, and the
government initiated several complex prosecutions during the
reporting season. The government also showed improved efforts
in the area of victim protection, primarily officials’ increased victim
identification measures.
For full report click here
____________________________________________________
US State Dept Terrorism Report 2009
No report available
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
| Further Tables |
|
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*Please note that FATF deems that a country has significant aml deficiencies if any
of the 'Core' Recommendations, R1, R5, R10, R13, SRII, or SRIV are rated either
Partially of Non-Compliant. These are marked in red.
For FATF to remove a country from the regular follow-up process, it has to be rated
Compliant or Largely Compliant in the above mentioned Core Recommendations
and the following Key Recommendations: -
R3, R4, R23, R26, R35, R36, R40, SRI, SRIII, SRV
Please also note that any risk assessment should take into consideration all
follow-up reports.
of the 'Core' Recommendations, R1, R5, R10, R13, SRII, or SRIV are rated either
Partially of Non-Compliant. These are marked in red.
For FATF to remove a country from the regular follow-up process, it has to be rated
Compliant or Largely Compliant in the above mentioned Core Recommendations
and the following Key Recommendations: -
R3, R4, R23, R26, R35, R36, R40, SRI, SRIII, SRV
Please also note that any risk assessment should take into consideration all
follow-up reports.
| ARUBA |
| KnowYourCountry |
|
___________________________________________________
AML News / Updates
May 1, 2011 - New report by the Global Forum on Transparency and
Exchange of Information to evaluate the country's legal and regulatory
frameworks re exchange of information is made available.
Read Report....
Links:
Worldwide AML Legislation (International Bar Association)
AML News / Updates
May 1, 2011 - New report by the Global Forum on Transparency and
Exchange of Information to evaluate the country's legal and regulatory
frameworks re exchange of information is made available.
Read Report....
Links:
Worldwide AML Legislation (International Bar Association)
|
Key Findings from last Mutual Evaluation Report
The level of criminality in Aruba is generally not high, but has increased
considerably over the last 10 years. Due to its geographical location and
travel facilities, money laundering is primarily linked to drug trafficking
and risks have been identified for cross border movement of cash, in the
real estate and jewellery sectors and through misuse of exempt
companies. Terrorist financing has not been seen as a major risk to date.
Aruba’s economic system is currently largely based on tourism and oil
refining; but the island has actively sought to diversify its economy, in
particular by developing its off-shore activities, through the licensing of
offshore banks, though in a limited number, and the development of
offshore companies. However, the measures in company and other laws
to ensure the transparency and integrity of these vehicles are
inadequate. The introduction in February 2009 of the State Ordinance
Supervision Trust Company Services Providers is aimed at regulating
trust and company service providers, and this will help. However, there is
still a significant weakness, as TCSPs are still not subject to basic
AML/CFT requirements. Aruban corporate vehicles represent a
substantial risk for misuse by launderers and other criminals, and rapid
and significant progress is required.
Aruba enhanced its ML offence in 2006, and has since taken effective
prosecution action against money launderers. However, Aruba has
chosen not to criminalise terrorist financing as required by SR. II,
considering that terrorist financing activity can be adequately dealt with
through existing provisions of the Criminal Code such as the ancillary
offences of preparation or participation or complicity in a terrorist attack,
or being a member of a terrorist organisation. This argument is rejected
by the assessment team, and Aruba is strongly urged to urgently
criminalise TF as a separate and independent offence. Similarly urgent
action is needed to implement UNSCR 1267 and 1373.
In general, Aruba’s system of AML/CFT preventive measures is
incomplete and lacks coherence and effectiveness. Aruba should
urgently review the structure of the regime, including the legislation and
dedicate more resources to the agencies in charge of AML/CFT. Aruba
should also give clearly defined tasks and priorities to each of those
agencies.
There are many financial activities being performed by financial
institutions that are neither regulated nor supervised. These financial
institutions are not subject to AML/CFT requirements, which creates
potential opportunities that could be misused by money launderers and
other criminals.
The basic preventive legislation for AML/CFT is set out in two state
ordinances, one dealing with Customer Due Diligence requirements, and
the other with the reporting obligations. However the legislative
requirements have many gaps relative to the FATF standards, and this is
exacerbated by a lack of clarity and consistency in the scope and the
extent of the obligations. Aruba should rectify this, and should seriously
consider preparing completely new and coherent legislation dealing with
all the deficiencies and implement all the FATF requirements.
The AML/CFT supervision of most of the FIs is currently handled by both
the MOT (Aruban FIU) and the Central Bank of Aruba (CBA), which
creates overlap and an inefficient use of already limited resources. The
supervision should thus be reorganised and strengthened, including the
introduction of a significantly more robust enforcement culture. It is
logical that the CBA should supervise all types of financial institutions for
all their AML/CFT obligations as this would result in a more consistent
and better organised approach to supervision. The CBA should consult
with the FIU on a regular basis.
A basic system for international co-operation is in place, but Aruba
should introduce a number of enhancements both at the judicial and
administrative levels. Consideration should also be given to reviewing
and updating the legislation.
The level of criminality in Aruba is generally not high, but has increased
considerably over the last 10 years. Due to its geographical location and
travel facilities, money laundering is primarily linked to drug trafficking
and risks have been identified for cross border movement of cash, in the
real estate and jewellery sectors and through misuse of exempt
companies. Terrorist financing has not been seen as a major risk to date.
Aruba’s economic system is currently largely based on tourism and oil
refining; but the island has actively sought to diversify its economy, in
particular by developing its off-shore activities, through the licensing of
offshore banks, though in a limited number, and the development of
offshore companies. However, the measures in company and other laws
to ensure the transparency and integrity of these vehicles are
inadequate. The introduction in February 2009 of the State Ordinance
Supervision Trust Company Services Providers is aimed at regulating
trust and company service providers, and this will help. However, there is
still a significant weakness, as TCSPs are still not subject to basic
AML/CFT requirements. Aruban corporate vehicles represent a
substantial risk for misuse by launderers and other criminals, and rapid
and significant progress is required.
Aruba enhanced its ML offence in 2006, and has since taken effective
prosecution action against money launderers. However, Aruba has
chosen not to criminalise terrorist financing as required by SR. II,
considering that terrorist financing activity can be adequately dealt with
through existing provisions of the Criminal Code such as the ancillary
offences of preparation or participation or complicity in a terrorist attack,
or being a member of a terrorist organisation. This argument is rejected
by the assessment team, and Aruba is strongly urged to urgently
criminalise TF as a separate and independent offence. Similarly urgent
action is needed to implement UNSCR 1267 and 1373.
In general, Aruba’s system of AML/CFT preventive measures is
incomplete and lacks coherence and effectiveness. Aruba should
urgently review the structure of the regime, including the legislation and
dedicate more resources to the agencies in charge of AML/CFT. Aruba
should also give clearly defined tasks and priorities to each of those
agencies.
There are many financial activities being performed by financial
institutions that are neither regulated nor supervised. These financial
institutions are not subject to AML/CFT requirements, which creates
potential opportunities that could be misused by money launderers and
other criminals.
The basic preventive legislation for AML/CFT is set out in two state
ordinances, one dealing with Customer Due Diligence requirements, and
the other with the reporting obligations. However the legislative
requirements have many gaps relative to the FATF standards, and this is
exacerbated by a lack of clarity and consistency in the scope and the
extent of the obligations. Aruba should rectify this, and should seriously
consider preparing completely new and coherent legislation dealing with
all the deficiencies and implement all the FATF requirements.
The AML/CFT supervision of most of the FIs is currently handled by both
the MOT (Aruban FIU) and the Central Bank of Aruba (CBA), which
creates overlap and an inefficient use of already limited resources. The
supervision should thus be reorganised and strengthened, including the
introduction of a significantly more robust enforcement culture. It is
logical that the CBA should supervise all types of financial institutions for
all their AML/CFT obligations as this would result in a more consistent
and better organised approach to supervision. The CBA should consult
with the FIU on a regular basis.
A basic system for international co-operation is in place, but Aruba
should introduce a number of enhancements both at the judicial and
administrative levels. Consideration should also be given to reviewing
and updating the legislation.
| Last Updated: 16 April 2012 |