HomeNewsBrief$4.2 Bn Laundered in Costa Rica Every Year: Official
BRIEF

$4.2 Bn Laundered in Costa Rica Every Year: Official

COSTA RICA / 14 MAY 2015 BY LOREN RIESENFELD EN

Over $4 billion is laundered in Costa Rica every year, according to a government official, where a high degree of financial openness combined with the country’s growing role in the regional drug trade has created conditions ripe for money laundering.

Mariano Figueras, the head of Costa Rica’s intelligence agency, known as the DIS for its Spanish acronym, said that $4.2 billion is laundered in Costa Rica every year, reported Diario Extra. The crime is so prolific, Figueras said, that “everyone in Costa Rica sees money laundering every day and in different forms.”

Much of the money laundering in Costa Rica is channeled through the country’s nascent construction industry -- when criminal organizations want to bring money into the legitimate financial system they tend to buy real estate or invest in construction, according to Diario Extra. Financial institutions, casinos, and currency exchange houses are also used to wash illicitly obtained income.

Figueras also noted the role of Costa Rica as a transshipment point in the regional drug trade -- the fact that the country lies squarely in the middle of drug routes moving from South America to the United States and money flowing back down, represents a "threat" to the Costa Rican economy.  The amount of illegal money swirling around is a threat compared to the relatively small size of the national economy.

InSight Crime Analysis

Figueras has finally put a number to what has long been a concern in Costa Rica. Like its southern neighbor Panama, which has the well-deserved reputation as Latin America’s money laundering hub, Costa Rica has a relatively open financial system, plenty of cash floating around the tourist sector, and profits from the growing drug trade that traffickers try to legitimize. Money laundering in Costa Rica is mostly connected to criminal organizations and the drug trade, which InSight Crime found in a 2011 investigation, as well as arms and human trafficking activities.

In one notable case in 2013, US law enforcement shut down a Costa Rica-based online currency exchange called Liberty Reserve, which prosecutors said was the “bank of choice for the criminal underworld.” A $6 billion business, Liberty Reserve was one of the largest online money laundering operations in history. The owner was able to establish the business in Costa Rica by marrying a Costa Rican citizen, but the exchange likely remained operational due to the country's lax regulations for online businesses.

SEE ALSO: Coverage of Costa Rica

Costa Rica has since tried to improve its anti-money laundering (AML) regulations, submitting to an audit from the Financial Action Task Force for Latin America (GAFILAT) in January, according to the Tico Times

In its 2015 International Narcotics Control Strategy Report (pdf), the US State Department noted Costa Rica has enacted all but two of the 21 recommended regulations designed to combat money laundering. Panama only lacked three of those regulations, but both remain on the State Department’s list of countries of "primary concern" for money laundering. 

share icon icon icon

Was this content helpful?

We want to sustain Latin America’s largest organized crime database, but in order to do so, we need resources.

DONATE

What are your thoughts? Click here to send InSight Crime your comments.

We encourage readers to copy and distribute our work for non-commercial purposes, with attribution to InSight Crime in the byline and links to the original at both the top and bottom of the article. Check the Creative Commons website for more details of how to share our work, and please send us an email if you use an article.

Was this content helpful?

We want to sustain Latin America’s largest organized crime database, but in order to do so, we need resources.

DONATE

Related Content

MEXICO / 25 AUG 2013

The US Treasury has added five associates of Mexico drug boss "El Azul" to its "Kingpin List," maintaining recent pressure…

MONEY LAUNDERING / 3 FEB 2012

Peru's justice minister, Juan Jimenez, vowed to increase the government's efforts against money laundering after revealing that the country currently…

MONEY LAUNDERING / 16 JUN 2015

US prosecutors say a businessman laundered up to $100 million for Colombian drug trafficking groups by financing Venezuelan companies in…

About InSight Crime

THE ORGANIZATION

Venezuela El Dorado Investigation Makes Headlines

3 DEC 2021

InSight Crime's investigation into the trafficking of illegal gold in Venezuela's Amazon region generated impact on both social media and in the press. Besides being republished and mentioned by several…

THE ORGANIZATION

Gender and Investigative Techniques Focus of Workshops

26 NOV 2021

On November 23-24, InSight Crime conducted a workshop called “How to Cover Organized Crime: Investigation Techniques and A Focus on Gender.” The session convened reporters and investigators from a dozen…

THE ORGANIZATION

InSight Crime Names Two New Board Members

19 NOV 2021

In recent weeks, InSight Crime added two new members to its board. Joy Olson is the former executive director of the Washington Office on Latin America…

THE ORGANIZATION

Senate Commission in Paraguay Cites InSight Crime

12 NOV 2021

InSight Crime’s reporting and investigations often reach the desks of diplomats, security officials and politicians. The latest example occurred in late October during a commission of Paraguay's Senate that tackled…

THE ORGANIZATION

Backing Investigative Journalism Around the Globe

5 NOV 2021

InSight Crime was a proud supporter of this year's Global Investigative Journalism Conference, which took place November 1 through November 5 and convened nearly 2,000 journalists…