In Costa Rica, greater banking control and the increased presence of organized crime explain the 58% increase in suspicious transaction reports in 2018 over 2017.
In the last two years, Suspicious Transaction Reports (SARs) submitted by banks to the Costa Rican Drug Institute (ICD) increased by 58%, from 320 in 2017 to 507 in 2018.
Guillermo Araya, director of the ICD, explained to Nacion.com that "...
Once enacted, the newly approved law will force accountants, lawyers, realtors, and other professionals to report suspicious transactions made by their clients.
Bill 19.951 reforming the Law on Narcotic Drugs, Psychotropic Substances, Drugs of Unauthorized Use, Related Activities, Legalization of Capital and Financing of Terrorism was approved in a second debate by the Legislative Assembly.
The amendment to the money laundering law approved in the first debate requires accountants, lawyers and real estate agents to report suspicious transactions made by their clients.
Bill 19.951 reforming the Law on Narcotic Drugs, Psychotropic Substances, Drugs of Unauthorized Use, Related Activities, Legalization of Capital and Financing of Terrorism was approved in a first debate by the Legislature on April 21.The new regulation establishes the obligations on professionals engaged in non-financial activities, such as lawyers, accountants, notaries and real estate agents, once the law is fully approved and enacted.
The housing market, casinos, concert halls, and the livestock sector are all used to launder money in Central American countries.
Excerpted from the report "International Narcotics Control Strategy Report, Volume II, Money Laundering and Financial Crimes" by the US State Department:
Costa Rica Transnational criminal organizations continue to favor Costa Rica as a base to commit financial crimes due to its location and limited enforcement capability. Costa Rica’s government has attempted to strengthen the legal framework for supervision and enforcement; however, challenges remain in mitigating money laundering risks. Costa Rica is a transit point that is also increasingly used as an operations base for narcotics trafficking; and significant laundering of proceeds from illicit activities continues. Costa Rica should continue to close financial crimes legislative gaps and allocate resources for investigation and prosecution.
The bill proposed by the Association of Accountants is based on Mexican law and seeks to regulate commercial activities between related companies from one country to another.
Although there has existed a regulation since 2013, which establishes rules on transfer pricing in the country, the bill proposes to go beyond the provisions of the regulations and establish formal legislation on the subject, as exists in other countries.
The Attorney General has denounced the existence of barriers that prevent white-collar crime and in particular corruption within the state from being pursued effectively.
The authorization from a judge for a case of public documents to be opened as part of an investigation, and the adoption of appeals even when the law states that they are not appropriate, are some of the legal obstacles that delay the processing of cases of white collar crime.
A law passed by the Assembly requires banks to require companies to show tax returns for the last two years and close accounts suspected of money laundering and terrorist financing.
The 8204 amendment to the Law adopted by the Assembly of Costa Rica also requires banks to refuse to open accounts for companies who are not able to justify the origin of their resources.
A bill approved in the Legislative Commission creates a register of shareholders to which the tax authority would have unrestricted access.
The main objective of the project against tax fraud is to enable the Directorate General of Taxation to seize the assets and bank accounts of taxpayers classified as delinquent, under the order of a judge.The embargoes could be extended for a period of up to two years.
Entrepreneurs who do business overseas could see their commercial operations affected if the country is included in the list of non cooperative nations in the fight against money laundering and terrorism financing.
EDITORIAL
The demonstrated difficulty of the Solis administration in governing, understood as the management of conflicts between different sectors of the population, makes it difficult to be optimistic and believe that it eill be able to approve, before July 15th, the laws against money laundering and terrorism financing, which would prevent the country from being included in the list of non-cooperative countries on these issues.
The agreement approved by the Legislative Assembly of Costa Rica states that information will be exchanged independently of whether the conduct under investigation constitutes an offense or not.
From a statement issued by the Legislative Assembly of Costa Rica:
Deputies approved in the process of a second debate, record 18840, Approval of the agreement between the Republic of Costa Rica and the Republic of Ecuador on exchange of information in tax matters.
This is the aim of the bill that would expunge ex-convict's criminal records so that they can find work without their potential employers knowing about their criminal past.
EDITORIAL
The vast majority of people resolve their economic and existential problems without resorting to crime. They are obliged to act this way because of the education they received in their homes, where they were taught not only be honest and law-abiding, but also to distrust those who are not. From children we learn to discriminate between bad and good, an essential life skill. We need to distinguish between food that is good and food that is harmful to our health. We must be able to distinguish between an honest business and one that is not. That's life, continuous decision making based on our knowledge and values which is what also should govern conduct in society.
If successful, the bill being discussed in the Legislative Assembly of Costa Rica, will make shareholders of corporations liable in cases of fraud.
The Legal Affairs Committee has endorsed a bill entitled Lifting the Veil of the Legal Personality, to be discussed in the plenary of the Legislative Assembly. The initiative aims to reform the Code of Commerce so that shareholders of corporations will be held accountable for the acts of the company in the event of any breach or violation of rights.
A correction to the Act 47 of 2013 enables corporations to continue to issue bearer shares.
By Alvaro Aguilar, partner at Lombardi Aguilar Group
The Government of Panama has issued a correction of Act 47 of 2013 so that corporations can continue to issue bearer shares. The law adopts a correction to the custody arrangement of bearer shares and the Government has enacted a law that seeks to preserve the image of Panama as a collaborating country in the fight against the abuse of its financial services, and which brings the nation up to date with trends in international law.
Latin America is barely ahead of Africa in quality standards and conditions affecting local businesses.
As a region, Central America, is located in the second half of the list entitled ‘Doing Business 2012’.
Doing Business 2012, a report by the World Bank this year added a new area of analysis, which is the ease of obtaining an electrical connection, along with the traditional items which include: ease of starting a business, management of construction permits, registering property , getting credit, protecting investors, paying taxes, cross border trade, enforcing contracts, and insolvency resolution.