Countries/Jurisdictions of Primary Concern - Haiti
Haitian criminal gangs are engaged in international drug trafficking and other criminal and fraudulent activity, but do not at this time appear to be involved in terrorist financing. While Haiti itself is not a major financial center, regional money laundering enterprises utilize Haitian couriers, especially via air hub routes to Central America. Much of the drug trafficking in Haiti, as well as the related money laundering, is connected to the United States. Further, most of the identified money laundering schemes involve significant amounts of U.S. currency, and all property confiscations involve significant drug traffickers convicted in the United States.
Foreign currencies comprise 57.3 percent of Haiti’s bank deposits, according to the Haitian Central Bank, likely due to the large influx of remittances, which reached $1.6 billion in 2012.
The weakness of the Haitian judicial system and prosecutorial mechanism continue to leave the country vulnerable to corruption and money laundering, despite improving financial intelligence and enforcement capacity.
Haiti has two operational free trade zones in Ouanaminthe and Carrefour. There are at least 62 casinos in Haiti, the majority unlicensed; however, online gaming is illegal.
For additional information focusing on terrorist financing, please refer to the Department of State’s Country Reports on Terrorism, which can be found at: http://www.state.gov/j/ct/rls/crt/
DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR ILLEGAL DRUG SALES THAT OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO
CRIMINALIZATION OF MONEY LAUNDERING:
“All serious crimes” approach or “list” approach to predicate crimes: List approach
Are legal persons covered: criminally: YES civilly: NO
KNOW-YOUR-CUSTOMER (KYC) RULES:
Enhanced due diligence procedures for PEPs: Foreign: NO Domestic: NO
KYC covered entities: Banks, casinos, securities dealers, insurance companies, notaries and attorneys, dealers in jewelry and precious metals, art dealers, real estate agents, automobile dealers, and money remittance institutions
Number of STRs received and time frame: 179: January 1 - October 31, 2013
Number of CTRs received and time frame: 223,456: January 1 - October 31, 2013
STR covered entities: Banks, cooperatives, credit unions, currency exchanges, issuers of money orders, insurance companies, casinos, real estate firms, and accounting firms
MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:
Prosecutions: 1 in 2013
RECORDS EXCHANGE MECHANISM:
With U.S.: MLAT: YES Other mechanism: NO
With other governments/jurisdictions: YES
Haiti is a member of the Caribbean Financial Action Task Force (CFATF), a FATF-style regional body. Its most recent mutual evaluation can be found at: https://www.cfatf-gafic.org/index.php?option=com_content&view=category&layout=blog&id=365&Itemid=550&lang=en
ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:
In the past year, the Government of Haiti passed a new AML/CFT law that expands the obligation of suspicious transaction reporting to non-financial businesses and professions. The law criminalizes terrorism financing, establishes new reporting procedures for suspected terrorism financing, and enables freezing and seizing of terrorist funds. A Ministerial Council can order immediate freezing of funds of any UN-designated terrorist group or individual, and a court can order seizure of assets for any parties convicted of money laundering or terrorism financing. However, the law also weakens the independence of the Haitian FIU by subordinating the unit to an investigative judge, only allowing the FIU to accept suspicious reports under a legal investigation. This significantly limits the FIU’s intelligence-gathering capacity and seriously compromises the efficacy of the STR reporting regime. Additionally, attorneys are specifically exempted from the obligation to report suspicious transactions.
In May 2013, the Senate passed an anti-corruption bill, which imposes prison sentences of 3-15 years for a host of newly codified crimes including bribery, embezzlement of public property, illegal procurements, and laundering of proceeds of crime. However, the legislation remains stalled in the Chamber of Deputies.
The FIU forwarded 10 cases to the judiciary in 2013; at least one prosecution was initiated. An investigating judge has two months from arrest to compile evidence, but there is no limit to the timeframe to schedule court dates, communicate with investigating agencies and prosecutors, and track financial data, meaning that investigations typically last at least a year.
Haiti should continue to devote resources to building an effective AML/CFT regime, to include continued support to units to investigate financial crimes and the development of an information technology system. The new AML/CFT law, despite strengthening the regulatory framework to combat financial crimes, undermines the independence and effectiveness of Haiti’s FIU. The government remains hampered by ineffective and outdated criminal and criminal procedural codes, and by the inability of judges and courts to address cases referred for prosecution. Draft criminal and criminal procedural codes that would address these problems were approved by the Council of Ministers, but are now under review by a Presidential Commission; after the Commission’s approval, the codes will go to Parliament for approval. Haiti also should take steps to establish a program to identify the cross-border movement of currency and financial instruments.