Overview:  Because Panama is a transit country for both licit and illicit goods, money, and migrants, the Government of Panama’s (GoP’s) willingness to engage in bilateral and multilateral CT initiatives is critically important for regional security.  Under President Cortizo, the GoP continued to cooperate on CT, especially through maritime sanctions and migration policy.  Panama is a key partner in the implementation and enforcement of sanctions on entities and individuals designated by U.S. and UN sanctions regimes, including sanctions relating to Cuba, Iran, Nicaragua, North Korea, Russia, Syria, and Venezuela.

In support of various U.S. sanctions regimes — including those related to countering terrorist financing and illegal, unreported, and unregulated fishing — Panama cancelled the registration of 235 Panamanian-flagged vessels in 2022.  Panama cooperated with U.S. authorities on several CT-related cases this year through the U.S. Immigration and Customs Enforcement’s Transnational Criminal Investigations Unit in Panama and additional interagency partnerships with other U.S. security and law enforcement agencies.  The country continued to lead the region in BITMAP enrollments.  Panama has been on the FATF “gray list” for deficiencies in its anti-money laundering regime since 2019.

The GoP must address deficiencies in its judicial system’s ability to prosecute white-collar criminals and improve the transparency of beneficial ownership or face the risk of FATF encouraging enhanced due diligence in business relations and transactions with the country.

2022 Terrorist Incidents:  There were no incidents related to international terrorism in Panama in 2022.

Legislation, Law Enforcement, and Border Security:  Although Panama does not have comprehensive CT legislation or a robust CT legal framework, it has an executive decree to control dual-use goods and has adopted a national control list for dual-use goods in accordance with its UNSCR 1540 obligations.  Panama also has an executive decree to address chemical, biological, radiological, and nuclear incidents.  While the country does not have a formal coordinating authority on migration below cabinet level, officials from the GoP’s National Security Council, National Border Service, National Migration Service, and National Police met frequently among themselves and with U.S. officials to efficiently coordinate and act on migration alerts and detain and deport travelers who represented a security risk.  Panama fully complied with its UNSCR 2396 obligations for the collection of biographic and biometric data, information sharing with regional partners, sharing of API, and participation in INTERPOL.

The Special Interest Aliens (SIAs) Joint Task Force — a bilateral mechanism to share information on SIAs and Known or Suspected Terrorists and detain and/or deport them as needed — cooperated on several CT-related cases.  The SIAs Joint Task Force continues to process Panama’s BITMAP data and provide intelligence information, analytical products, and migration trends to Panamanian officers.  The GoP’s biometric enrollments provide U.S. agencies with information on foreign partners’ law enforcement and border encounters with SIAs, gang members, and other persons of interest.

While Panama’s own intelligence capacity was limited, the GoP acted as a willing partner in responding to U.S. CT-related alerts.  Lack of diplomatic relationships with some migrants’ countries of origin and logistical challenges such as arranging flights continued to limit the GoP’s ability to deport.

The Ministry of Security and the National Customs Authority made progress in a bidding process to address the country’s lack of cargo scanners.  In May, three GoP-purchased scanners arrived in Panama; four additional U.S. government-procured scanners are set to arrive in 2023.  This will help the GoP analyze cargo transiting the country, including at Tocumen International Airport — which has the highest number of passenger transits in the region — and entry to and exit from the Colón Free Trade Zone.  Limited scanner capabilities, along with a lack of proper institutional and interagency protocols at ports, had greatly increased the risk of illicit cargo transiting undetected to and through Panama.  Current GoP efforts, supported by Embassy Panama City, will continue to increase interagency information sharing and expand situational awareness in the land, air, and maritime border security environments.

Panama continued to cooperate with U.S. law enforcement on ongoing CT cases this year.  However, the GoP’s ability to investigate financial support to terrorist-related organizations remained limited.

Countering the Financing of Terrorism:  Panama is a member of GAFILAT (the Financial Action Task Force of Latin America), and its FIU, the Financial Analysis Unit-Panama, is a member of the Egmont Group.  Panama remained on the FATF “gray list” in 2022.  Panama’s action plan to address strategic deficiencies expired in January 2021.  FATF has repeatedly called on Panama to swiftly complete all measures on its expired action plan or it would consider calling on its members and urging all jurisdictions to apply enhanced due diligence to business relations and transactions with Panama.

In 2022, FATF reported that Panama took steps toward improving its AML/CFT.  Panama did so by strengthening its understanding of the ML and terrorist financing risk of legal persons and improving the monitoring of the corporate sector.  It also focused on ML investigations in relation to high-risk areas (particularly those investigations involving foreign predicates and the seizing and confiscation of proceeds of crime), and ensured effective, proportionate, and dissuasive sanctions in response to AML/CFT violations.

Panama is a key partner in the implementation and enforcement of sanctions on entities and individuals designated by U.S. and UN sanctions regimes.  In 2022, Panama’s Maritime Authority reported canceling the registration of 235 Panamanian-flagged vessels to comply with various sanctions regimes, including those related to countering terrorist financing and illegal, unreported, and unregulated fishing.

For further information on money laundering and financial crimes, see the 2022 International Narcotics Control Strategy Report, Volume 2, Money Laundering and Financial Crimes.

Countering Violent Extremism:  There were no changes in 2022.

International and Regional Cooperation:  Panama continued working to strengthen its implementation of UN resolutions that promote the nonproliferation of weapons of mass destruction.  The OAS Inter-American Committee Against Terrorism received funding from the Export Control and Related Border Security (EXBS) program in 2022 to strengthen Panama’s implementation of UNSCR 1540 and contribute to increasing the effectiveness of customs administration in Panama.  The project focuses on providing legislative assistance to help Panama comply with international instruments and obligations; promoting outreach to the private sector, industry, and academia to increase awareness of potential proliferation risks; and building capacity to strengthen national capabilities to mitigate and combat potential risks.  OAS is also engaging academia as part of this initiative.

Panama continued its active participation in regional security initiatives.  The U.S. Department of State’s Office of Cooperative Threat Reduction and the Department of Energy’s Pacific Northwest National Laboratory hosted virtual workshops on countering the financing of terrorism in Panama, focusing on proliferation financing and sanctions evasion.  The workshops included detailed overviews of best practices for risk assessment and mitigation strategies for government regulators and representatives from the judicial sector.  EXBS also is providing funding to help Panama draft its National Action Plan for Proliferation Financing, a new FATF requirement that all countries must complete by 2024.  In 2022, Embassy Panama City carried out training for Panamanian prosecutors, judges, police, forensic experts, bank supervisors, stock market personnel, and Financial Analysis Unit staff on money-laundering investigation techniques, trade-based money laundering, and cryptocurrency as a method of money-laundering.

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