________________________________________________________
US State Dept Terrorism Report 2009
No report available
________________________________________________________
AML News / Relevant Information
June 12, 2011 - Statement on the Economy extracted from 2011
IMF Report
Read Statement (internal link)
Links:
Worldwide AML Legislation (International Bar Association)
|
|
Sanctions:
None applicable
____________________________________________________
Offshore Jurisdiction Blacklists:
Information unavailable.
____________________________________________________
US State Department Money Laundering Report - 2011:
Papua New Guinea (PNG) is not a major financial center. It has a
relatively stable banking system closely integrated with the
financial systems of Australia and New Zealand. Smuggling and
public corruption are problems in PNG but there is no evidence
these activities generate substantial funds that are laundered.
PNG is developing mechanisms to combat money laundering and
terrorist financing, but still has a long way to go towards effective
enforcement.
PNG is not a destination country for most drugs of abuse.
Marijuana is the most commonly produced, distributed, and used
illegal drug in PNG, but is seldom trafficked out of the country and
doesn’t usually amount to any significant value necessitating a
sophisticated laundering process. Major sources of illegal
proceeds include corporate non-payment of taxes, undervaluing
extractible exports, and skirting customs regulations. Papua New
Guinea does not have an offshore sector, free trade zone,
informal financial sector, or other area particularly vulnerable to
financial crimes.
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: YES
CRIMINALIZATION OF TERROIRST 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: Financial institutions; gambling houses, casinos,
and lotteries; investment managers; real estate agents; dealers in
antiquities; money brokers; attorneys when acting for a client on a
financial or real estate transaction; accountants when receiving
funds in the course of business relating to deposits, investments
or other prescribed business
Enhanced due diligence procedures for PEPs: Foreign: NO
Domestic: NO
SUSPICIOUS TRANSACTION REPORTING REQUIREMENTS
Covered entities: Financial institutions; gambling houses, casinos,
and lotteries; investment managers; real estate agents; dealers in
antiquities; money brokers; attorneys when acting for a client on a
financial or real estate transaction; accountants when receiving
funds in the course of business relating to deposits, investments
or other prescribed business
Number of STRs received and time frame: 1,094 in 2010
Number of CTRs received and time frame: Not available
MONEY LAUNDERING CRIMINAL
PROSECUTIONS/CONVICTIONS
Prosecutions: None
Convictions: None
Assets forfeited: criminally: None civilly: 1.3 million Kina
(approximately $504,000) in 2010
RECORDS EXCHANGE MECHANISM
With U.S.: YES
With other governments/jurisdictions: YES
Papua New Guinea is a member of the Asia/Pacific Group on
Money Laundering, a Financial Action Task Force (FATF)-style
regional body. Papua New Guinea was scheduled to undergo a
World Bank-led mutual evaluation in late 2010.
ENFORCEMENT AND IMPLEMENTATION ISSUES AND
COMMENTS
Papua New Guinea’s legal system is still developing and
transitioning from traditional law and order systems based on
tribal seniority and indigenous customs. Western-style legislation
is being generated, but enforcing agencies significantly lack the
training, funding, assets, experience, and, in many cases,
education to successfully combat sophisticated organized crime.
Australian authorities partner closely with PNG counterparts to
advise and build capacity in these regards.
The Government of Papua New Guinea should continue its work
to develop procedures to conform to international anti-money
laundering/counter-terrorist financing programs and standards.
PNG law enforcement, specifically the Financial Intelligence Unit
and Prosecutor’s office should work to identify, disrupt, and
prosecute suspected money laundering operations. Papua New
Guinea should become a party to the UN Convention against
Transnational Organized Crime and the 1988 UN Drug
Convention.
______________________________________________
US State Dept Narcotics Report 2011 (introduction):
No report available
____________________________________________________
US State Dept Trafficking in Persons Report 2011
(introduction):
(Tier 3)
Papua New Guinea is a source, destination, and transit country
for men, women, and children subjected to sex trafficking and
forced labor. Women and children are subjected to sex trafficking
and domestic servitude; trafficked men are forced to labor in
logging and mining camps. Children, especially young girls from
tribal areas, are most vulnerable to commercial sexual exploitation
or subjected to forced labor by members of their immediate family
or tribe. Families traditionally sell girls into forced marriages to
settle their debts, leaving them vulnerable to forced domestic
service, and tribal leaders trade the exploitative labor and service
of girls and women for guns and political advantage. Young girls
sold into marriage are often forced into domestic servitude for the
husband’s extended family. In more urban areas, some children
from poorer families are prostituted by their parents or sold to
brothels. Migrant women and teenage girls from Malaysia,
Thailand, China, and the Philippines are subjected to sex
trafficking and men from China are transported to the country for
forced labor.
Asian crime rings, foreign logging companies, and foreign
businessmen arrange for some women to voluntarily enter Papua
New Guinea with fraudulently issued tourist or business visas.
Subsequent to their arrival, smugglers turn many of the women
over to traffickers who transport them to logging and mining
camps, fisheries, and entertainment sites where they are exploited
in forced prostitution and domestic servitude. Foreign and local
men are exploited for labor at mines and logging camps, where
some receive almost no pay and are compelled to continue
working for the company indefinitely through debt bondage
schemes. Employers foster workers’ greater indebtedness to the
company by paying the workers sub-standard wages while
charging them artificially inflated prices at the company store;
employees’ only option becomes to buy food and other
necessities on credit. Government officials facilitate trafficking by
accepting bribes to allow illegal migrants to enter the country or to
ignore victims forced into prostitution or labor, by receiving female
trafficking victims in return for political favors, and by providing
female victims in return for votes.
The Government of Papua New Guinea does not fully comply with
the minimum standards for the elimination of trafficking and is not
making significant efforts to do so. Despite the government’s
acknowledgement of trafficking as a problem in the country, the
government did not investigate any suspected trafficking
offenses, prosecute or convict any trafficking offenders under
existing laws, address allegations of officials complicit in human
trafficking crimes, or identify or assist any trafficking victims during
the year.
For full report click here
None applicable
____________________________________________________
Offshore Jurisdiction Blacklists:
Information unavailable.
____________________________________________________
US State Department Money Laundering Report - 2011:
Papua New Guinea (PNG) is not a major financial center. It has a
relatively stable banking system closely integrated with the
financial systems of Australia and New Zealand. Smuggling and
public corruption are problems in PNG but there is no evidence
these activities generate substantial funds that are laundered.
PNG is developing mechanisms to combat money laundering and
terrorist financing, but still has a long way to go towards effective
enforcement.
PNG is not a destination country for most drugs of abuse.
Marijuana is the most commonly produced, distributed, and used
illegal drug in PNG, but is seldom trafficked out of the country and
doesn’t usually amount to any significant value necessitating a
sophisticated laundering process. Major sources of illegal
proceeds include corporate non-payment of taxes, undervaluing
extractible exports, and skirting customs regulations. Papua New
Guinea does not have an offshore sector, free trade zone,
informal financial sector, or other area particularly vulnerable to
financial crimes.
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: YES
CRIMINALIZATION OF TERROIRST 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: Financial institutions; gambling houses, casinos,
and lotteries; investment managers; real estate agents; dealers in
antiquities; money brokers; attorneys when acting for a client on a
financial or real estate transaction; accountants when receiving
funds in the course of business relating to deposits, investments
or other prescribed business
Enhanced due diligence procedures for PEPs: Foreign: NO
Domestic: NO
SUSPICIOUS TRANSACTION REPORTING REQUIREMENTS
Covered entities: Financial institutions; gambling houses, casinos,
and lotteries; investment managers; real estate agents; dealers in
antiquities; money brokers; attorneys when acting for a client on a
financial or real estate transaction; accountants when receiving
funds in the course of business relating to deposits, investments
or other prescribed business
Number of STRs received and time frame: 1,094 in 2010
Number of CTRs received and time frame: Not available
MONEY LAUNDERING CRIMINAL
PROSECUTIONS/CONVICTIONS
Prosecutions: None
Convictions: None
Assets forfeited: criminally: None civilly: 1.3 million Kina
(approximately $504,000) in 2010
RECORDS EXCHANGE MECHANISM
With U.S.: YES
With other governments/jurisdictions: YES
Papua New Guinea is a member of the Asia/Pacific Group on
Money Laundering, a Financial Action Task Force (FATF)-style
regional body. Papua New Guinea was scheduled to undergo a
World Bank-led mutual evaluation in late 2010.
ENFORCEMENT AND IMPLEMENTATION ISSUES AND
COMMENTS
Papua New Guinea’s legal system is still developing and
transitioning from traditional law and order systems based on
tribal seniority and indigenous customs. Western-style legislation
is being generated, but enforcing agencies significantly lack the
training, funding, assets, experience, and, in many cases,
education to successfully combat sophisticated organized crime.
Australian authorities partner closely with PNG counterparts to
advise and build capacity in these regards.
The Government of Papua New Guinea should continue its work
to develop procedures to conform to international anti-money
laundering/counter-terrorist financing programs and standards.
PNG law enforcement, specifically the Financial Intelligence Unit
and Prosecutor’s office should work to identify, disrupt, and
prosecute suspected money laundering operations. Papua New
Guinea should become a party to the UN Convention against
Transnational Organized Crime and the 1988 UN Drug
Convention.
______________________________________________
US State Dept Narcotics Report 2011 (introduction):
No report available
____________________________________________________
US State Dept Trafficking in Persons Report 2011
(introduction):
(Tier 3)
Papua New Guinea is a source, destination, and transit country
for men, women, and children subjected to sex trafficking and
forced labor. Women and children are subjected to sex trafficking
and domestic servitude; trafficked men are forced to labor in
logging and mining camps. Children, especially young girls from
tribal areas, are most vulnerable to commercial sexual exploitation
or subjected to forced labor by members of their immediate family
or tribe. Families traditionally sell girls into forced marriages to
settle their debts, leaving them vulnerable to forced domestic
service, and tribal leaders trade the exploitative labor and service
of girls and women for guns and political advantage. Young girls
sold into marriage are often forced into domestic servitude for the
husband’s extended family. In more urban areas, some children
from poorer families are prostituted by their parents or sold to
brothels. Migrant women and teenage girls from Malaysia,
Thailand, China, and the Philippines are subjected to sex
trafficking and men from China are transported to the country for
forced labor.
Asian crime rings, foreign logging companies, and foreign
businessmen arrange for some women to voluntarily enter Papua
New Guinea with fraudulently issued tourist or business visas.
Subsequent to their arrival, smugglers turn many of the women
over to traffickers who transport them to logging and mining
camps, fisheries, and entertainment sites where they are exploited
in forced prostitution and domestic servitude. Foreign and local
men are exploited for labor at mines and logging camps, where
some receive almost no pay and are compelled to continue
working for the company indefinitely through debt bondage
schemes. Employers foster workers’ greater indebtedness to the
company by paying the workers sub-standard wages while
charging them artificially inflated prices at the company store;
employees’ only option becomes to buy food and other
necessities on credit. Government officials facilitate trafficking by
accepting bribes to allow illegal migrants to enter the country or to
ignore victims forced into prostitution or labor, by receiving female
trafficking victims in return for political favors, and by providing
female victims in return for votes.
The Government of Papua New Guinea does not fully comply with
the minimum standards for the elimination of trafficking and is not
making significant efforts to do so. Despite the government’s
acknowledgement of trafficking as a problem in the country, the
government did not investigate any suspected trafficking
offenses, prosecute or convict any trafficking offenders under
existing laws, address allegations of officials complicit in human
trafficking crimes, or identify or assist any trafficking victims during
the year.
For full report click here
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| PAPUA NEW GUINEA |
| KnowYourCountry |
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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.
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.
|
Key Findings on 2011 MER
1. Papua New Guinea (PNG) faces very serious risks of ML
from various criminal activities including domestic corruption
(misappropriation of public funds), which is considered a serious
problem. PNG is experiencing rapid economic growth, very large
scale foreign investment and an escalating crime rate. While the
Financial Intelligence Unit (FIU) is building its capacity, there is no
clear political level commitment to ‘follow the money’ to tackle
corruption and other crimes, and no demonstrated commitment to
regulate and supervise AML obligations by financial sector
regulators, which severely hampers the authorities ability to tackle
financial aspects of corruption.
2. Misappropriation of government funds occurs using
government payments which, according to the authorities, are
generally placed through the banking sector in PNG and used
to purchase real estate, high-value vehicles, distributed in cash or
moved offshore. The techniques to launder proceeds from other
large-scale crimes in PNG such as illegal logging, arms
trafficking, and fraud are less clear. There is no indication of TF
risks in PNG.
3. The FIU has minimal resources, currently the FIU has only
three staff, having started out three years ago with seven. It has not
been given a formal structure within the Police force. It cannot fulfil
the role it should be playing in developing the national AML
system and receiving, analysing and disseminating reports.
4. Despite hard work by the FIU and some initial results to pursue
proceeds of crime by the OPP, the authorities lack a systematic focus
on the concept of ‘follow the money’ to tackle profit driven crime.
The authorities have good information on the volume and
techniques of laundering the proceeds of large scale corruption,
but a lack of political will, poor inter-agency cooperation, lack of
resources and concerns over undue influence undermine the
efforts of the few agencies actively pursuing ML and proceeds of
crime in PNG. Trust between agencies is low.
5. PNG has formally required its financial sector to adopt
basic anti-money laundering / combating the financing of terrorism
(AML/CFT) preventive measures for several years, however the
obligations are only heeded by the banking sector and postal
service. In depth AML/CFT obligations have not been issued by
any regulator and supervision and enforcement of the existing
AML/CFT requirements has not yet taken place. In practice, the
levels of implementation of customer due diligence (CDD),
internal controls and suspicious transaction reporting in the
banking sector are higher than the national requirements due
to group-compliance policies (foreign subsidiaries) and efforts to
adopt best practices. Papua New Guinea has not yet
commenced supervision and enforcement of AML/CFT requirements
and key regulators have been notably absent from efforts to
regulate and supervise for AML/CFT.
Click here to view Mutual Evaluation Report (pdf file)
1. Papua New Guinea (PNG) faces very serious risks of ML
from various criminal activities including domestic corruption
(misappropriation of public funds), which is considered a serious
problem. PNG is experiencing rapid economic growth, very large
scale foreign investment and an escalating crime rate. While the
Financial Intelligence Unit (FIU) is building its capacity, there is no
clear political level commitment to ‘follow the money’ to tackle
corruption and other crimes, and no demonstrated commitment to
regulate and supervise AML obligations by financial sector
regulators, which severely hampers the authorities ability to tackle
financial aspects of corruption.
2. Misappropriation of government funds occurs using
government payments which, according to the authorities, are
generally placed through the banking sector in PNG and used
to purchase real estate, high-value vehicles, distributed in cash or
moved offshore. The techniques to launder proceeds from other
large-scale crimes in PNG such as illegal logging, arms
trafficking, and fraud are less clear. There is no indication of TF
risks in PNG.
3. The FIU has minimal resources, currently the FIU has only
three staff, having started out three years ago with seven. It has not
been given a formal structure within the Police force. It cannot fulfil
the role it should be playing in developing the national AML
system and receiving, analysing and disseminating reports.
4. Despite hard work by the FIU and some initial results to pursue
proceeds of crime by the OPP, the authorities lack a systematic focus
on the concept of ‘follow the money’ to tackle profit driven crime.
The authorities have good information on the volume and
techniques of laundering the proceeds of large scale corruption,
but a lack of political will, poor inter-agency cooperation, lack of
resources and concerns over undue influence undermine the
efforts of the few agencies actively pursuing ML and proceeds of
crime in PNG. Trust between agencies is low.
5. PNG has formally required its financial sector to adopt
basic anti-money laundering / combating the financing of terrorism
(AML/CFT) preventive measures for several years, however the
obligations are only heeded by the banking sector and postal
service. In depth AML/CFT obligations have not been issued by
any regulator and supervision and enforcement of the existing
AML/CFT requirements has not yet taken place. In practice, the
levels of implementation of customer due diligence (CDD),
internal controls and suspicious transaction reporting in the
banking sector are higher than the national requirements due
to group-compliance policies (foreign subsidiaries) and efforts to
adopt best practices. Papua New Guinea has not yet
commenced supervision and enforcement of AML/CFT requirements
and key regulators have been notably absent from efforts to
regulate and supervise for AML/CFT.
Click here to view Mutual Evaluation Report (pdf file)
| Further Tables |
| Last Updated: 16 April 2012 |