Diagram showing the people and companies identified by actions related to money laundering, according to the U.S. Department of the Treasury´s Office of Foreign Assets Control.
It has been announced that deposits up to $9,200 (L200,000) per person will be returned, and then payments to employees, depositors and others, noting that "... there are sufficient resources to address them all."
The cause is the inclusion of the institution in the list of the U.S Office of Foreign Assets Control, and the freezing of its assets abroad.
Insecurity and lack of effective government actions explain the perception of the business sector regarding the investment climate in the country, which has fallen to the lowest level since 1999.
From the Report on the Legal and Institutional Situation first half of 2015 by the Salvadoran Foundation for Development:
The chain of fast foodrestaurants Hooters has announced the temporary closure of its branch in San Salvador due to the climate of insecurity and violence in the country.
President Sanchez Ceren has passed a Special Law Against Crime Extortion, which aims to improve the fight against the unfortunate practice which primarily affects the business sector.
From a statement issued by the presidency of El Salvador:
The president, Salvador Sanchez Ceren, has sanctioned Legislative Decree No. 953 containing the Special Law Against CrimeExtortion, proposed by the government to streamline the prosecution of this crime.
The Legislature has passed a law authorizing the Attorney General to carry out investigations on its own initiative, without the need for a formal complaint.
From a statement issued by the Legislative Assembly of El Salvador:
The National Assembly unanimously passed the Special Law Against Crime Extortion, which will toughen criminal and procedural sanctions, as well as administrative measures for the prevention, investigation, and prosecution of the crime of extortion.
Added to the production costs assumed by Salvadoran sugarcane growers during the harvest is expenditure to be made on private security and support for the police to prevent theft and extortion.
Sugarcane growers have allocated a budget for additional security costs which must be assumed due to increased threats and extortion by criminals.
Industrialists are pointing to political and legal uncertainty, high crime rates, corruption, bureaucracy and red tape as the main factors that are keeping away investors.
According to the Salvadoran Association of Industrialists (ASI), the government is not providing the right conditions in the country for the economy to grow, but, on the contrary has adopted tax reforms, which do not contribute its reactivation.
Employers point to political instability, energy costs and lack of infrastructure as the main factors keeping out investment and reducing competitiveness.
A survey carried out with employers by the National Association of Private Enterprise (ANEP) showed as its first result the lack of competitiveness of the country in terms of attracting foreign investment, due to uncertainty created by political instability.
90% of small business owners are extorted and many have had to leave the country, reported industry representatives.
Although the percentage of extortion of SMEs has increased 20% in 8 months, 76% of employers affected do not report it for fear of reprisals. The overall business perception is an increase in criminal behavior, constant threats by organized groups and greater mistrust of the National Civil Police (PNC), according to reports by the National Council of Small Business of El Salvador (CONAPES).
The U.S. Government has renewed its travel alert warning stating that the levels of violence and crime remains high.
From a statement issued by the U.S. Embassy in El Salvador:
The Department of State continues to warn U.S. citizens that crime and violence levels in El Salvador remain critically high. This Travel Warning supersedes the Travel Warning dated August 9, 2013, and includes updated information on crime and security in El Salvador.
Drug trafficking and gangs are the main factors responsible for intentional murders in the most violent countries in the world: Honduras, Belize, El Salvador and Guatemala.
According to a report by the United Nations Office on Drugs and Crime at the United Nations (UNODC), in 2012 Honduras recorded 90.4 killings per 100,000 inhabitants.
President Funes signed the Law Against Money and Asset Laundering without noticing the lack of special controls for Politically Exposed Persons.
The special controls for Politically Exposed Persons (PEP), was one of the reforms that was left out because the deputies did not approve it and the President, Mauricio Funes did not suggest it despite this being a recommendation by the Caribbean Financial Action Task Force Group (CFATF by its initials in Spanish).
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