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Mutual Evaluation Report of the Republic of Guatemala

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Mutual Evaluation Report of the Republic of Guatemala Mutual Evaluation Report of the Republic of Guatemala NOVEMBER 2016 Mutual Evaluation Report of Guatemala CONTENTS TABLE OF ACRONYMS.................................................................................................................... 3 EXECUTIVE SUMMARY .................................................................................................................. 4 MUTUAL EVALUATION REPORT ..................................................................................................11 Preface............................................................................................................................................11 CHAPTER 1. ML/TF RISKS AND CONTEXT ...............................................................................12 CHAPTER 2. NATIONAL AML/CFT POLICIES AND COORDINATION .....................................25 Immediate Outcome 1 (Risk, Policy and Coordination) ......................................................................26 CHAPTER 3. LEGAL SYSTEM AND OPERATIONAL PROBLEMS .............................................33 Immediate Outcome 6 (financial intelligence ML/TF) ........................................................................34 Immediate Outcome 7 (investigation and prosecution of ML) .............................................................43 Immediate Outcome 8 (confiscation).................................................................................................57 CHAPTER 4. TERRORIST FINANCING AND FINANCING OF PROLIFERATION ..........................64 Immediate Outcome 9 (TF investigation and prosecution) ..................................................................65 Immediate Outcome 10 (TF preventive measures and financial sanctions) ...........................................68 Immediate Outcome 11 (financial sanctions FPWMD) .......................................................................72 CHAPTER 5. PREVENTIVE MEASURES .........................................................................................74 Immediate Outcome 4 (preventive measures) ....................................................................................74 CHAPTER 6. SUPERVISION ........................................................................................................79 Key findings and recommended actions ............................................................................................79 Immediate Outcome 3 (supervision)..................................................................................................79 CHAPTER 7. STRUCTURES AND LEGAL PEOSONS ......................................................................89 Key findings and recommended actions ............................................................................................89 Immediate Outcome 5 (legal persons and arrangements) ....................................................................89 CHAPTER 8. INTERNATIONAL COOPERATION........................................................................96 Key findings and recommended actions ............................................................................................96 Immediate Outcome 2 (International cooperation) .............................................................................96 TECHNICAL COMPLIANCE ANNEX............................................................................................ 105 Recommendation 1 - Risk assessment and implementation of a risk-based approach .......................... 105 Recommendation 2 - National cooperation and coordination ............................................................ 108 Recommendation 3 - Money laundering offence .............................................................................. 109 Recommendation 4 - Confiscation and provisional measures ............................................................ 111 Recommendation 5 - Terrorism financing offence............................................................................ 112 Recommendation 6 Targeted financial sanctions related to terrorism and terrorist financing ............... 114 Recommendation 7 - Targeted financial sanctions related to proliferation.......................................... 115 Recommendation 8 - Non-profit organizations................................................................................. 116 Recommendation 9 - Secrecy laws of financial institutions............................................................... 119 Recommendation 10 - Customer due diligence ................................................................................ 119 Recommendation 11 - Recordkeeping ............................................................................................. 123 Recommendation 12 - PEPs ........................................................................................................... 124 Recommendation 13 - Correspondent banking ................................................................................. 125 Recommendation 14 - Money transfer services or securities ............................................................. 125 Recommendation 15 - New technologies......................................................................................... 126 Recommendation 16 - Wire transfers .............................................................................................. 127 Recommendation 17 - Dependence on third parties .......................................................................... 129 Recommendation 18 - Internal controls and foreign branches and subsidiaries ................................... 130 Weighting and conclusion .............................................................................................................. 131 Recommendation 19 - Higher risk countries .................................................................................... 131 Recommendation 20 - Suspicious transaction reporting .................................................................... 132 Recommendation 21 - Revelation (tipping-off) and confidentiality ................................................... 133 1 Mutual Evaluation Report of Guatemala Recommendation 22 - DNFBPs: Customer Due Diligence ............................................................... 133 Recommendation 23 - DNFBPs: Other measures ............................................................................. 134 Recommendation 24 - Transparency and beneficial ownership of legal persons ................................. 135 Recommendation 25 - Transparency and beneficial ownership of the legal structures ......................... 138 Recommendation 26 - Regulation and supervision of financial institutions ........................................ 139 Recommendation 27 - Powers of supervisors................................................................................... 141 Recommendation 28 - Regulation and supervision of DNFBPs ......................................................... 142 Recommendation 29 - Financial Intelligence Units .......................................................................... 143 Recommendation 30 - Responsibilities of law enforcement and investigative authorities .................... 147 Recommendation 31 - Powers of law enforcement and investigative Authorities................................ 148 Recommendation 32 - Cash couriers ............................................................................................... 150 Recommendation 33 - Statistics ...................................................................................................... 151 Recommendation 34 – Guide and feedback ..................................................................................... 152 Recommendation 35 - Sanctions ..................................................................................................... 152 Recommendation 36 - International instruments .............................................................................. 153 Recommendation 37 – Mutual Legal Assistance .............................................................................. 154 Recommendation 38 - Mutual legal assistance: freezing and confiscation .......................................... 155 Recommendation 39 - Extradition................................................................................................... 156 Recommendation 40 - Other forms of international cooperation........................................................ 158 2 Mutual Evaluation Report of Guatemala TABLE OF ACRONYMS AML/CFT Anti-money laundering and combating the financing of terrorism. DNFBP Designated Non-Financial Businesses and Professions. BANGUAT Bank of Guatemala. CGC General Comptroller’s Office. CONABED National Council for Property Management in Asset Forfeiture. COPRECLAFT Presidential Commission for the Coordination of Efforts Against Money Laundering or other Assets, Terrorist Financing and Financing of Proliferation of Weapons of Mass Destruction. COPRET Presidential Commission for Transparency and E-government. CDD Customer Due Diligence. DIGICI General Directorate of Civil Intelligence. DIGICRI General Directorate of Criminal Investigation. ER Electronic Report NRA National Risk Assessment. FCLA PPO - Section Against Money Laundering and Other Assets. FPWMD Financing of Proliferation of Weapons of Mass Destruction. FTC Funds Transfer Companies TF Terrorism Financing. INACOP National Institute of Cooperatives. INGECOP General
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