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Money Laundering Watch List

USA Includes Peru on Black List of Money Laundering Locations

Just recently the US Department of State published and released its annual report regarding drug trafficking and financial crimes that occurred in 2016. Among several other Latin American countries, Peru was included on the list of top money laundering places in the world.

According to an article published in Gestión which summarizes the report provided by the United States government, Peru is vulnerable to such corruption as illegal gold mining, logging, and smuggling, all of which have been closely linked to the drug trafficking industry.

Within the past 10 years, the Peruvian Financial Intelligence Unit (FIU) has identified approximately US $4.4 billion in revenues that are suspected to be related to illegal mining. However, the report suggests that the illegal gold trade in Peru is equivalent to US $2.6 billion per year.

Moreover, the report explains the ways in which money is laundered through money transfers, notaries, formal financial institutions, casinos, currently exchange, and merchandise trade. Ultimately, the endemic of corruption hinders investigations and the way of justice. Moreover, remittance companies, such as travel agencies and money transfer businesses, are unregulated in Peru and are therefore susceptible to money-laundering practices.

To conclude, the report has recognized that Peru requires increased regulation of financial institutions as well as designated non-financial businesses and professions. However, this is not able to be realized since the FIU does not have access to the resources that are required to efficiently monitor and prevent money laundering.

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