|
Sanctions:
None applicable
____________________________________________________
Offshore Jurisdiction Blacklists:
Information unavailable.
____________________________________________________
US State Department Money Laundering Report - 2011:
Iceland is not considered a regional financial center. Money
laundering in Iceland is related primarily to narcotics smuggling
and trading and is not considered a major problem. Criminal
proceeds tend to derive from domestic organizations with some
linkages to foreign groups. As of late 2010, investigators
continued to look into the 2008 collapse of Iceland’s financial
system and to re-examine allegations that its banks may have
been involved in money laundering. Documents relating to such
allegations have circulated among officials in Iceland, Denmark,
Luxembourg and the Serious Fraud Office in London.
A wide-ranging inquiry into the collapse of Iceland’s banks has
started to unravel a complicated network of unconventional loan
agreements between the banks and high-level business people. A
Special Investigation Commission (SIC) delivered a report to the
Icelandic parliament in April 2010 concluding that former
ministers, the former executive board of the Central Bank, and the
former chairman of the Financial Supervisory Authority had made
mistakes and showed negligence in their positions. The report
states also that the three major banks bear legal responsibility for
the crash; they were too large, grew too fast, granted bank
owners easy access to loans, and loaned bank employees capital
to buy shares of the banks themselves.
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: NO
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
(Please refer to the Department of State’s Country Reports on
Terrorism, which can be found here: http://www.state.
gov/s/ct/rls/crt)
KNOW-YOUR-CUSTOMER RULES:
Covered entities: Banks; currency exchanges; attorneys; auditors;
real estate dealers; trust, safekeeping, and company service
providers; life insurance companies and pension funds; insurance
brokers and intermediaries; securities brokers; and dealers in
vessels or any high-value items
Enhanced due diligence procedures for PEPs: Foreign: YES
Domestic: NO
SUSPICIOUS TRANSACTION REPORTING REQUIREMENTS:
Covered entities: Banks; currency exchanges; attorneys; auditors;
real estate dealers; trust, safekeeping, and company service
providers; life insurance companies and pension funds; insurance
brokers and intermediaries; securities brokers; and dealers in
vessels or any high-value items
Number of STRs received and time frame: 494 in 2009
Number of CTRs received and time frame: Not applicable
MONEY LAUNDERING CRIMINAL
PROSECUTIONS/CONVICTIONS:
Prosecutions: Two in 2009
Convictions: None in 2009
Assets forfeited: criminally: 725,308,744 ISK (approximately $4
million) in 2009 civilly: Not applicable
RECORDS EXCHANGE MECHANISM:
With U.S.: NO
With other governments/jurisdictions: YES
Iceland is a member of the Financial Action Task Force. Its latest
mutual evaluation report can be found here: http://www.fatf-gafi.
org/dataoecd/54/38/37706239.pdf
ENFORCEMENT AND IMPLEMENTATION ISSUES AND
COMMENTS:
The Government of Iceland (GOI) has improved its anti-money
laundering/counter-terrorist financing (AML/CFT) system through
the enforcement of existing laws, and review and implementation
of international standards. A domestic mechanism should be
implemented to allow designation of terrorists at a national level
as well as to give effect to designations and asset freeze requests
from other countries. The GOI should continue to enhance its
AML/CFT program, as appropriate. Iceland should become a party
to the UN Convention against Transnational Organized Crime and
the UN Convention against Corruption.
____________________________________________________
US State Dept Narcotics Report 2011 (introduction):
No report available
____________________________________________________
US State Dept Trafficking in Persons Report 2011
(introduction):
(Tier 2)
Iceland is a destination and transit country for women subjected to
forced prostitution. Some reports maintain Iceland also may be a
destination country for men and women who are subjected to
conditions of forced labor in the restaurant and construction
industries. A 2009 Icelandic Red Cross report claimed that there
were at least 59 and possibly as many as 128 cases of human
trafficking in Iceland over the three years prior to the report;
female victims of human trafficking in Iceland came from Eastern
Europe, Russia, Africa, South America, and Southeast Asia.
During the reporting period, foreign women in prostitution within
the country were vulnerable to sex trafficking. According to the
Red Cross report, undocumented foreign workers – mostly from
Eastern Europe and Baltic states – in Iceland’s manufacturing and
construction industries were vulnerable to forced labor. During the
reporting period, local authorities were unable to document cases
of forced labor but did acknowledge violations of immigration or
employment law. Authorities suspected involvement of organized
crime in trafficking.
The Government of Iceland does not fully comply with the
minimum standards for the elimination of trafficking; however, it is
making significant efforts to do so. The Icelandic government
made important progress in victim protection this year, identifying
and caring for more victims of trafficking than in the previous year.
The government also approved two new residence permits to
assist victims of trafficking and provided funding for a new shelter
to aid the long-term reintegration of trafficking victims. During the
year, the Iceland police developed formal guidelines for victim
identification. Nevertheless, the Government of Iceland’s
prevention activities were limited and, in contrast with the last
reporting period, it prosecuted no trafficking offenses. Critically,
the Icelandic government continued to prescribe a sentence for
trafficking that was half that prescribed for other violent crimes
such as rape and aggravated physical assault; the statutory
maximum sentence did not oblige Icelandic police to hold human
trafficking suspects in pre-trial detention.
For full report click here
____________________________________________________
US State Dept Terrorism Report - 2009
The Government of Iceland stated in its most recent terrorist
threat assessment, conducted by the National Police
Commissioner in 2008, that the likelihood of terrorist activities
occurring in Iceland is low. In the same assessment, however, the
government concluded that the potential consequences of such
activities were severe enough to merit a high level of vigilance.
The government, therefore, continued its efforts to strengthen
domestic border security and counterterrorism capabilities during
the year. Notably, the Government of Iceland passed legislation in
December that clarified the legal definition of terrorism and
strengthened penalties against money launderers.
The National Police Commissioner has primary responsibility for
counterterrorism efforts in the country. The Viking Squad, Iceland’
s counterterrorism unit, is considered the first line of defense in
Iceland’s efforts against terrorism. The paramilitary unit is
comprised of approximately 40-50 members who are trained in
active counterterrorism response by U.S. and other European
police and military counterterrorism units. The National Security
Unit, which also falls under the jurisdiction of the National Police
Commissioner, gathers intelligence, drafts threat assessments,
and exchanges information with foreign counterparts with the aim
to prevent or reduce the likelihood of terrorism.
The Icelandic Coast Guard (ICG) is responsible for Iceland’s
coastal defense and monitors the ocean around Iceland, both
within and outside of territorial waters. The ICG served as the
Chair of the North Atlantic Coast Guard Forum in 2009 and hosted
the organization’s annual conference in September. Also in
September, the ICG hosted Northern Challenge 2009, a NATO-
supported exercise focusing on explosive ordnance disposal and
counterterrorism scenarios. The explosive ordinance team was
called upon in December when a Lufthansa flight heading to
Detroit made an emergency landing in Iceland after the aircraft
was found to be carrying luggage for a passenger who had not
boarded the plane. The explosive ordinance team found nothing
suspicious and the flight was released in short order. The EOD
team has served in international peacekeeping missions in Iraq
and Afghanistan.
The Icelandic government supported multilateral counterterrorism
efforts. Iceland continued its deployment of personnel at Kabul
International Airport and International Security Assistance Force
(ISAF) Headquarters in Afghanistan in support of NATO
operations.
____________________________________________________
Links:
Worldwide AML Legislation (International Bar Association)
None applicable
____________________________________________________
Offshore Jurisdiction Blacklists:
Information unavailable.
____________________________________________________
US State Department Money Laundering Report - 2011:
Iceland is not considered a regional financial center. Money
laundering in Iceland is related primarily to narcotics smuggling
and trading and is not considered a major problem. Criminal
proceeds tend to derive from domestic organizations with some
linkages to foreign groups. As of late 2010, investigators
continued to look into the 2008 collapse of Iceland’s financial
system and to re-examine allegations that its banks may have
been involved in money laundering. Documents relating to such
allegations have circulated among officials in Iceland, Denmark,
Luxembourg and the Serious Fraud Office in London.
A wide-ranging inquiry into the collapse of Iceland’s banks has
started to unravel a complicated network of unconventional loan
agreements between the banks and high-level business people. A
Special Investigation Commission (SIC) delivered a report to the
Icelandic parliament in April 2010 concluding that former
ministers, the former executive board of the Central Bank, and the
former chairman of the Financial Supervisory Authority had made
mistakes and showed negligence in their positions. The report
states also that the three major banks bear legal responsibility for
the crash; they were too large, grew too fast, granted bank
owners easy access to loans, and loaned bank employees capital
to buy shares of the banks themselves.
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: NO
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
(Please refer to the Department of State’s Country Reports on
Terrorism, which can be found here: http://www.state.
gov/s/ct/rls/crt)
KNOW-YOUR-CUSTOMER RULES:
Covered entities: Banks; currency exchanges; attorneys; auditors;
real estate dealers; trust, safekeeping, and company service
providers; life insurance companies and pension funds; insurance
brokers and intermediaries; securities brokers; and dealers in
vessels or any high-value items
Enhanced due diligence procedures for PEPs: Foreign: YES
Domestic: NO
SUSPICIOUS TRANSACTION REPORTING REQUIREMENTS:
Covered entities: Banks; currency exchanges; attorneys; auditors;
real estate dealers; trust, safekeeping, and company service
providers; life insurance companies and pension funds; insurance
brokers and intermediaries; securities brokers; and dealers in
vessels or any high-value items
Number of STRs received and time frame: 494 in 2009
Number of CTRs received and time frame: Not applicable
MONEY LAUNDERING CRIMINAL
PROSECUTIONS/CONVICTIONS:
Prosecutions: Two in 2009
Convictions: None in 2009
Assets forfeited: criminally: 725,308,744 ISK (approximately $4
million) in 2009 civilly: Not applicable
RECORDS EXCHANGE MECHANISM:
With U.S.: NO
With other governments/jurisdictions: YES
Iceland is a member of the Financial Action Task Force. Its latest
mutual evaluation report can be found here: http://www.fatf-gafi.
org/dataoecd/54/38/37706239.pdf
ENFORCEMENT AND IMPLEMENTATION ISSUES AND
COMMENTS:
The Government of Iceland (GOI) has improved its anti-money
laundering/counter-terrorist financing (AML/CFT) system through
the enforcement of existing laws, and review and implementation
of international standards. A domestic mechanism should be
implemented to allow designation of terrorists at a national level
as well as to give effect to designations and asset freeze requests
from other countries. The GOI should continue to enhance its
AML/CFT program, as appropriate. Iceland should become a party
to the UN Convention against Transnational Organized Crime and
the UN Convention against Corruption.
____________________________________________________
US State Dept Narcotics Report 2011 (introduction):
No report available
____________________________________________________
US State Dept Trafficking in Persons Report 2011
(introduction):
(Tier 2)
Iceland is a destination and transit country for women subjected to
forced prostitution. Some reports maintain Iceland also may be a
destination country for men and women who are subjected to
conditions of forced labor in the restaurant and construction
industries. A 2009 Icelandic Red Cross report claimed that there
were at least 59 and possibly as many as 128 cases of human
trafficking in Iceland over the three years prior to the report;
female victims of human trafficking in Iceland came from Eastern
Europe, Russia, Africa, South America, and Southeast Asia.
During the reporting period, foreign women in prostitution within
the country were vulnerable to sex trafficking. According to the
Red Cross report, undocumented foreign workers – mostly from
Eastern Europe and Baltic states – in Iceland’s manufacturing and
construction industries were vulnerable to forced labor. During the
reporting period, local authorities were unable to document cases
of forced labor but did acknowledge violations of immigration or
employment law. Authorities suspected involvement of organized
crime in trafficking.
The Government of Iceland does not fully comply with the
minimum standards for the elimination of trafficking; however, it is
making significant efforts to do so. The Icelandic government
made important progress in victim protection this year, identifying
and caring for more victims of trafficking than in the previous year.
The government also approved two new residence permits to
assist victims of trafficking and provided funding for a new shelter
to aid the long-term reintegration of trafficking victims. During the
year, the Iceland police developed formal guidelines for victim
identification. Nevertheless, the Government of Iceland’s
prevention activities were limited and, in contrast with the last
reporting period, it prosecuted no trafficking offenses. Critically,
the Icelandic government continued to prescribe a sentence for
trafficking that was half that prescribed for other violent crimes
such as rape and aggravated physical assault; the statutory
maximum sentence did not oblige Icelandic police to hold human
trafficking suspects in pre-trial detention.
For full report click here
____________________________________________________
US State Dept Terrorism Report - 2009
The Government of Iceland stated in its most recent terrorist
threat assessment, conducted by the National Police
Commissioner in 2008, that the likelihood of terrorist activities
occurring in Iceland is low. In the same assessment, however, the
government concluded that the potential consequences of such
activities were severe enough to merit a high level of vigilance.
The government, therefore, continued its efforts to strengthen
domestic border security and counterterrorism capabilities during
the year. Notably, the Government of Iceland passed legislation in
December that clarified the legal definition of terrorism and
strengthened penalties against money launderers.
The National Police Commissioner has primary responsibility for
counterterrorism efforts in the country. The Viking Squad, Iceland’
s counterterrorism unit, is considered the first line of defense in
Iceland’s efforts against terrorism. The paramilitary unit is
comprised of approximately 40-50 members who are trained in
active counterterrorism response by U.S. and other European
police and military counterterrorism units. The National Security
Unit, which also falls under the jurisdiction of the National Police
Commissioner, gathers intelligence, drafts threat assessments,
and exchanges information with foreign counterparts with the aim
to prevent or reduce the likelihood of terrorism.
The Icelandic Coast Guard (ICG) is responsible for Iceland’s
coastal defense and monitors the ocean around Iceland, both
within and outside of territorial waters. The ICG served as the
Chair of the North Atlantic Coast Guard Forum in 2009 and hosted
the organization’s annual conference in September. Also in
September, the ICG hosted Northern Challenge 2009, a NATO-
supported exercise focusing on explosive ordnance disposal and
counterterrorism scenarios. The explosive ordinance team was
called upon in December when a Lufthansa flight heading to
Detroit made an emergency landing in Iceland after the aircraft
was found to be carrying luggage for a passenger who had not
boarded the plane. The explosive ordinance team found nothing
suspicious and the flight was released in short order. The EOD
team has served in international peacekeeping missions in Iraq
and Afghanistan.
The Icelandic government supported multilateral counterterrorism
efforts. Iceland continued its deployment of personnel at Kabul
International Airport and International Security Assistance Force
(ISAF) Headquarters in Afghanistan in support of NATO
operations.
____________________________________________________
Links:
Worldwide AML Legislation (International Bar Association)
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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.
| ICELAND |
| KnowYourCountry |
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| Last Updated: 16 April 2012 |