...and I will tell you who you are. In their quest to reduce exposure to risk, banking correspondents have started to restrict the services they provide to gambling companies, remittance companies, and brokerage firms that are not related to banking groups in the region.
Friday, August 18, 2017
In order to reduce risk exposure, some international banks with correspondents in Panama and other countries in the region are failing to open accounts for or provide services for companies whose income comes from activities such as remittances and gambling.The banks' argument is that they are more likely to be used for money laundering. Even non-banking brokerage firms claim to have difficulty offering their customers products and services,"... since banks wont open accounts in which customers can deposit their funds and receive a return on their investment."
Miguel Antonio Gómez, from the Committee of Compliance Officers at the Colombian Association of Game Operators, "... explained the difficulties that are being faced in their country in terms of maintaining relations with banks and the negative effects of this situation. If I can channel resources through the financial sector, what better way to have a trace.But if I do not have access to the financial sector, I save the money and start paying payroll and providers in cash.Through the financial system there can be control of money and resources."
Prensa.com reports that "...Edison Silva, who heads a remittance company in Panama, said that there is a duality between the need to apply a risk management system that ensures that the company is not used for mismanagement but at the same time not affecting customers and profitability ...The remittance sector is one of the hardest hit by the phenomenon of de-risking."
An example of this can be seen in Uruguay, where several banks have warned pharmacies legally allowed to sell marijuana that they are going to close their bank accounts, in adherence with international regulations regarding profits from the sale of illegal substances.
After the Nicaraguan Assembly approved a bill that forces local banks to allow public officials sanctioned by OFAC to have an account, there are fears that the country will be isolated from the international financial system.
A statement issued by the National Assembly on February 3 explains that the deputies approved the Law Initiative of Reform and Addition to the Law for the Protection of the Rights of Consumers and Users, a legislative project which guarantees a better and greater protection of the rights of consumers and users in the access to goods and services as a human right recognized by the Nicaraguan State.
In May, approval could be given to the regulation of the law that obliges real estate agents, pawn shops and lawyers, among others, to report suspicious operations of more than $10,000.
The socialization process of the regulation of the Law for the regulation of designated non-financial professional activities (APNFD) has already ended, and Congress estimates that next month it could be approved.
A bill has been put forward which aims to include credit card operators who are not currently subject to regulation by the SUGEF.
If the bill promoted by the Executive thrives in the Legislature, companies that issue credit cards and who are not part of the already regulated "financial groups...
Non-banking companies have been allowed to provide financial services on behalf of established banks.
The preamble to the Agreement states that "the hiring out by banks of customer service networks for the provision of certain services and operations on its behalf, known as non-banking correspondents, has been an effective channel with which a greater depth of financial services has been reached, allowing banks to operate in places where they do not have branches or ATMs and reduce transaction costs without incurring excessive risk.”
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