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

BRAZIL / 30 MAR 2017

In our March 30 Facebook Live session, Senior Investigator Deborah Bonello and Senior Editor Mike LaSusa discussed some of the…

MEXICO / 13 SEP 2016

Organized crime groups are getting creative with credit cards to move illicit proceeds across international borders without setting off regulatory…

MONEY LAUNDERING / 7 JUN 2013

Authorities in Peru have observed a sharp increase in the number of budget hotels, gambling houses, and other small…

About InSight Crime

THE ORGANIZATION

Unraveling the Web of Elites Connected to Organized Crime

27 JUL 2021

InSight Crime published Elites and Organized Crime in Nicaragua, a deep dive into the relationships between criminal actors and elites in that Central American nation.

THE ORGANIZATION

InSight Crime’s Greater Focus on US-Mexico Border

20 JUL 2021

InSight Crime has decided to turn many of its investigative resources towards understanding and chronicling the criminal dynamics along the US-Mexico border.

THE ORGANIZATION

Key Arrests and Police Budget Increases Due to InSight Crime Investigations

8 JUL 2021

With Memo Fantasma’s arrest, InSight Crime has proven that our investigations can and will uncover major criminal threats in the Americas.

THE ORGANIZATION

Organized Crime’s Influence on Gender-Based Violence

30 JUN 2021

InSight Crime investigator Laura N. Ávila spoke on organized crime and gender-based violence at the launch of a research project by the United Nations Development Programme.

THE ORGANIZATION

Conversation with Paraguay Judicial Operators on PCC

24 JUN 2021

InSight Crime Co-director Steven Dudley formed part of a panel attended by over 500 students, all of whom work in Paraguay's judicial system.