PHILIPSBURG--An inspection by the Law Enforcement Council has shown that the approach of judicial authorities in St. Maarten to combating money laundering and terrorism financing is insufficient and requires more attention.
In its report, the Council assessed the approach of the judicial authorities in combating money laundering and terrorism financing. Just as in its previous reports regarding cross-border crime the Council observed that there are various bottlenecks impeding an effective (joint) approach to money laundering and terrorism financing by authorities.
According to the Council, the continuous lack of resources specifically hampers the authorities from achieving the desired results, as well as further professionalising their organisations and executing their lawful tasks.
Cross-border crimes such as money laundering and terrorism financing, if not combated sufficiently, can have far-reaching consequences for the image of a country, its economy and undermines the democratic legal order, the Council pointed out. “Given the nature of cross-border crimes and that these forms of crime also greatly impact local crime, it is imperative that the Minister of Justice makes the necessary investments to better enable authorities to apply countermeasures.”
Also, given the need of the country to comply with the recommendations of the Caribbean Financial Action Task Force (CFATF) on the subject of money laundering and terrorism financing by 2024, the Council stresses that a determined effort by the Minister of Justice is necessary in order to carry out the recommendations of the Council as soon as possible. “It is imperative that countries live up to international obligations set to address the phenomenon of money laundering and terrorism financing and that countermeasures and mechanisms based on these are being utilised by the judicial authorities to combat the phenomenon in Sint Maarten.”
Legislation and policies
The crime analysis of 2011 painted a picture of a government/judicial system in which money laundering was allowed to flourish due to the inability of authorities to combat these crimes. Little has changed since then, the Council concluded.
“The fact that money laundering continues to go unchecked is worrisome, as this form of crime is often – how other forms of crime, such as drug trafficking and arms trafficking, are funded,” the Council stated. “The complexity of money laundering combined with a lack of resources, for example financial expertise, at the authorities is one of the main causes why it cannot be combated effectively. As such, the scale of money laundering, just as in 2011, remains guesswork. However, authorities still suspect that it continues to happen on a large scale.”
In as far as terrorism financing is concerned, the Council noted that authorities currently have not observed any concrete signs of terrorism financing in St. Maarten. However, this is possibly due to the lack of oversight. It is therefore possible that it also takes place.
The St. Maarten Government still has work to do in drafting policy and updating some of the regulations in the area of combating money laundering and terrorism financing, the Council concluded. “The Ministry of Justice has not yet established a specific policy to combat money laundering and terrorism as stipulated in the law but has since (2020) drawn upon the reforms stipulated in the country package as a guideline. The soon to be established National Risk Assessment can aid authorities in drafting said policy and the Council encourages all efforts in this regard.”
The protocols currently in place regarding border control and detective cooperation as well as the country reforms present opportunities to strengthen authorities in combating cross- border crimes such as money laundering and terrorism financing.
The Council also considered it positive that the focus is on border control, because other cross-border crimes, such as drug trafficking, can indirectly contribute to crimes of money laundering. Another positive aspect is that all the partners in the judicial chain are cognisant of the situation and highly aware that this is a major threat that needs to be addressed effectively.
Limited capacity
The Council is of the opinion that the approach to combating money laundering and terrorism financing would benefit from a common goal and long-term vision. The Council therefore encourages the Ministry of Justice and other relevant ministries and their departments to come together to ensure that the judicial approach as well as the administrative approach does not fall behind. To successfully create barriers to combat money laundering and terrorism financing it is conditional that all tools available are utilised. Therefore, a criminal justice approach alone cannot achieve the desired results.
Local investigative authorities are only able to carry out limited investigations into money laundering, whether as a stand-alone offence or as a component of a criminal investigation, due to their lack of financial investigative capacity. But the Council has also established that, despite suffering from a staff shortage, the FIU, for example, is able to produce reports of suspicious transactions.
On the other hand, the Anti-Corruption Taskforce (TBO), having specialist expertise and sufficient capacity, has been able to conduct large scale criminal investigations and was able to apprehend and prosecute key subversive figures. In some of these cases money laundering formed a component.
The Asset Recovery Team (ART) was established as a control mechanism to deprive criminals of their gains after conviction. The concept entailed a multidisciplinary team, under the authority of the Public Prosecutor’s Office, comprising of the Tax Office, Customs, Dutch Caribbean Coast Guard and the Sint Maarten Police Force (KPSM). Although the concept of the ART has proven unfeasible in practice, the effectiveness of the team is hampered due to bottlenecks in the area of lack of participation and expertise.
Twelve recommendations
The Council pointed out the importance of authorities giving sufficient priority to money laundering and terrorism financing. The Council acknowledged the constraints of the organisations, due to a lack of resources, but noted that the consequences of these forms of cross-border crimes going unchecked were not to be overlooked. The Council therefore presented 12 recommendations to the Minister of Justice to address the issues.
