HomeNewsBriefHas Panama Kicked Its Money Laundering Habit?
BRIEF

Has Panama Kicked Its Money Laundering Habit?

MONEY LAUNDERING / 10 MAR 2020 BY PARKER ASMANN EN

A new report says that Panama remains a nation of “particular concern” when it comes to financial secrecy and money laundering, suggesting that the Central American nation hasn’t quite kicked it’s reputation as a haven for washing dirty money.

Panama placed in the top 15 of countries around the world with the highest rates of financial secrecy and was the most secretive nation in all of Latin America and the Caribbean, according to the Tax Justice Network’s Financial Secrecy Index for 2020. 

(Graphic c/o Tax Justice Network)

Using a combination of qualitative data like laws and regulations to generate a secrecy index and quantitative data to create a weighted global scale, the report concluded that Panama “remains a jurisdiction of extreme concern,” with the country’s top ranking underscoring the “harmful nature of [its] offshore activity.”

However, on a global scale, the index noted that Panama accounts for “just 0.22 percent of the global market for offshore financial services,” making it a “small player compared to other secrecy jurisdictions” like the Cayman Islands and Hong Kong, among others.

In addition to having more than 350,000 secretive international business companies, the report found that the country is “active” in forming “tax-evading foundations and trusts, insurance, and boat and shipping registration,” all of which violate financial secrecy laws.

InSight Crime Analysis

Panama has for years been slammed by international organizations for being “vulnerable to money laundering from a number of sources including drug trafficking and other predicate crimes committed abroad such as fraud, financial and tax crimes,” according to a 2014 report from the International Monetary Fund (IMF).

However, in early 2016, the Financial Action Task Force (FATF) removed Panama from its “grey list” of countries particularly vulnerable to money laundering, noting that authorities had “established the legal and regulatory framework” to meet its commitments to right shortcomings identified by the task force.

Still, the latest report suggests that Panama is still failing to live up to its pledge to combat financial secrecy and the flow of dirty money through the country. Just last year in February 2019, for example, the European Commission blacklisted Panama along with 22 other countries around the world as having “strategic deficiencies in their anti-money laundering [and] counter terrorist financing regimes.”

SEE ALSO: Panama News and Profile

“Dirty money is the lifeblood of organized crime and terrorism,” said Věra Jourová, the EU's then Commissioner for Justice, Consumers and Gender Equality. “I invite the countries listed to remedy their deficiencies swiftly.”

That said, Panama may soon be on the verge of turning a new leaf with the recent election of President Laurentino Cortizo in 2019. “We come from a lost decade of corruption and improvisation, of stealing money from Panamanians,” Cortizo said upon taking office. “There will be no untouchables, even if they are ministers, deputies and big businessmen, starting with the president himself.”

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

MONEY LAUNDERING / 22 AUG 2013

The British Virgin Islands (BVI) has begun talks with the United States over improving financial transparency and reporting requirements for…

PANAMA / 29 NOV 2010

Street gangs in Panama are continuing to gain territory, according to a recent report.

FARC / 25 JUL 2013

Coca crops and processing laboratories have been discovered in Panama for the second time this year, suggesting that cultivation is now creeping…

About InSight Crime

THE ORGANIZATION

Venezuela Drug Trafficking Investigation and InDepth Gender Coverage

29 APR 2022

On May 4, InSight Crime will be publishing The Cocaine Revolution in Venezuela, a groundbreaking investigation into how the Venezuelan government regulates the cocaine trade in the country. An accompanying event,…

THE ORGANIZATION

InDepth Coverage of Juan Orlando Hernández

22 APR 2022

Ever since Juan Orlando Hernández was elected president of Honduras in 2014, InSight Crime has provided coverage of every twist and turn during his rollercoaster time in office, amid growing…

THE ORGANIZATION

Venezuela's Cocaine Revolution

15 APR 2022

On May 4th, InSight Crime will publish a groundbreaking investigation on drug trafficking in Venezuela. A product of three years of field research across the country, the study uncovers cocaine production in…

LA ORGANIZACIÓN

Widespread Coverage of InSight Crime MS13 Investigation

8 APR 2022

In a joint investigation with La Prensa Gráfica, InSight Crime recently revealed that four of the MS13’s foremost leaders had been quietly released from…

THE ORGANIZATION

Informing US State Department and European Union

1 APR 2022

InSight Crime Co-director McDermott briefed the US State Department and other international players on the presence of Colombian guerrillas in Venezuela and the implication this has for both nations.  McDermott…