TRINIDAD & TOBAGO
Summary
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Sanctions

None

FAFT AML Deficient

No

Higher Risk Areas

US Dept of State Money Laundering assessment

Not on EU White list equivalent jurisdictions

Compliance of OECD Global Forum’s information exchange standard

Medium Risk Areas

 

Compliance with FATF 40 + 9 Recommendations

Corruption Index (Transparency International & W.G.I.)

World Governance Indicators (Average Score)

Failed States Index (Political Issues)(Average Score)

 

 

ANTI-MONEY LAUNDERING

 

FATF Status

Trinidad and Tobago is no longer on the FATF List of Countries that have been identified as having strategic AML deficiencies

 

Latest FATF Statement - 19 October 2012

The FATF welcomes Trinidad and Tobago’s significant progress in improving its AML/CFT regime and notes that Trinidad and Tobago has established the legal and regulatory framework to meet its commitments in itsAction Plan regarding the strategic deficiencies that the FATF had identified in February 2010. Trinidad and Tobago is therefore no longer subject to FATF’s monitoring process under its on-going global AML/CFT compliance process. Trinidad and Tobago will work with CFATF as it continues to address the full range of AML/CFT issues identified in its Mutual Evaluation Report, particularly implementation of the new legislative and regulatory reform in order to more effectively combat illicit finance in Trinidad and Tobago.

 

Compliance with FATF Recommendations

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Trinidad and Tobago was undertaken by the Financial Action Task Force (FATF) in 2016. According to that Evaluation, Trinidad and Tobago was deemed Compliant for 12 and Largely Compliant for 13 of the FATF 40 Recommendations.

 

Key Findings from Report

Overall Level of Compliance and Effectiveness

Identifying, assessing and understanding risk: Trinidad and Tobago is currently conducting its NRA in collaboration with the World Bank. This assessment is being spearheaded by NAMLC. The Assessors note that Trinidad and Tobago’s understanding of risk is limited and there has been varied assessments of such risk by CAs. The NRA, therefore, would be helpful in assisting Trinidad and Tobago with identifying, assessing and mitigating the risk posed by ML/TF.

The Limited Use of Financial Intelligence: Trinidad and Tobago has robust legislation that allows for LEAs to gather financial intelligence and information to investigate ML, TF and associated predicate offences. These enactments being the POCA and the ATA also provides for the LEAs to trace, restrain and confiscate the proceeds of crime. The FIUA allows for the FIUTT to receive, analyse and disseminate financial information to the relevant LEAs. The FIUTT has disseminated several Intelligence Reports (IRs) to LEAs as part of its mandate. Three of these reports have led to the arrest and prosecution of five individuals for ML offences. However, the Assessors observed that a large number of SARs received by the FIUTT are still awaiting analysis or have been filed for intelligence purposes. It should also be noted that a number of the IRs disseminated to the Financial Investigations Branch (FIB) are still under investigation. The Assessors were informed that there has been an improvement in the quality of IRs submitted by the FIUTT as of 2014.

Money Laundering Investigation and Prosecution: LEAs in Trinidad and Tobago considered the risk associated with ML as being medium to high. The jurisdiction has recorded three cases of ML that have resulted in charges being brought against five individuals. The cases are currently pending before the Court. The information provided indicates that these cases were as a result of parallel investigations conducted between the FIB and the Fraud Squad. There are no arrests for stand-alone ML. The investigation of ML is not properly prioritized by LEAs. The lack of ML arrests coupled with the risks associated with the jurisdiction along with the lack of priority given to investigation suggests that the offence of ML is not properly investigated. Furthermore, none of the cases for which persons have been charged with ML have been adjudicated by the Court and this therefore creates a difficulty in determining whether these cases have been properly investigated. In the absence of convictions for ML, it is not possible to say conclusively that matters are being properly investigated. The absence of convictions for the offence of ML means that no sanctions have been applied by the Court. The offence of ML is not given priority within the Court system.

Confiscation: Confiscation is not treated with priority within Trinidad and Tobago. Trinidad and Tobago does not have any confiscation proceedings pertaining to ML, TF or any predicate offences. Recent changes to the POCA have created a loophole whereby confiscation may not be possible if the criminal ML conduct is not linked to a specified offence.

The Seized Assets Fund (SAF) which is for monies seized under the POCA and the ATA has not been properly established as persons have not been appointed to the Seized Assets Committee and Regulations governing the management and operation of the fund have not as yet been developed.

Terrorist Financing: The offence of terrorist financing has been adequately criminalised in the ATA and related regulations. The FIUTT has mandated in its Standard Operating Procedures (SOP) that STRs relating to TF are to be given priority and outlines the procedure upon receipt of these STRs. The Assessors were informed that these IRs were delivered to the relevant person within the Trinidad and Tobago Police Service (TTPS). There has been no feedback to the FIUTT in relation to these IRs. The Assessors note that a report of TF was submitted since 2013 and there is no evidence to suggest that any actions have been taken against the individuals or entities mentioned in the report. There is no indication that TF is prioritized and properly investigated by LEAs as there has been no designation of entities or persons as terrorists, no assets restrained nor any arrests or convictions for TF offences. The framework for targeted sanctions related to the financing of terrorism needs to be significantly tightened up. There are not adequate sanctions or prohibitions in respect of making funds or facilities available to designated persons and all the requirements for freezing funds are not covered in the ATA. There is no comprehensive policy on the proliferation of financing of weapons of mass destruction and there is no adequate legislation on this issue. There does not appear to be a thorough appreciation of the risk of TF amongst the relevant authorities. There are inadequate resources to effectively investigate and prosecute TF.

Non Profit Organisations (NPOs): NPOs are required to register with the Registrar General’s Department however there is no proper AML/CTF policy in relation to the management, supervision and monitoring of these entities. A targeted risk assessment for these entities has not been done as yet, neither are there adequate laws to address this area which means that for most intents and purposes the sector is not being sufficiently regulated.

Preventive Measures – The regulatory framework in relation to preventive measures is largely in place as demonstrated by the level of technical compliance by Trinidad and Tobago. However, significant gaps exist in the manner in which FIs and listed businesses (LBs) in Trinidad and Tobago implement these requirements. Gaps exist in understanding risk, applying enhanced due diligence to PEPS, internal controls and performance of CDD measures based on risk.

Supervision – The supervisory regime undertaken by the Central Bank of Trinidad and Tobago (CBTT) is robust and well developed given that it has had significantly more years of experience than the other CAs. Supervision performed by the CBTT is sound. Additionally, the FIUTT as a supervisor has demonstrated its capabilities while the Trinidad and Tobago Securities and Exchange Commission (TTSEC) has only recently begun direct AML/CFT supervision. Except for the CBTT there are issues of resources and expertise. Across the board, Regulators have not demonstrated sufficient understanding of risk and applied that understanding to how they regulate on a risk sensitive basis. Sanctions imposed by supervisors have been limited and the range of sanctions available have not been utilised adequately by supervisors. Supervisors need to consider wider use of those powers as well as seeking additional powers such as the ability to impose monetary administrative penalties.

National AML/CFT Policies and Coordination – There is an overall AML/CFT framework in place. The framework is coordinated by the NAMLC. Domestic coordination occurring amongst the key stakeholders has resulted in a number of positive strides within the AML/CFT framework. However, all sectors have not been covered in terms of articulation and thorough dissemination of the AML/CFT policy and in assessing and understanding the country-wide risks. There is need for greater resources to be invested so that all the key agencies are sufficiently funded.

Legal Persons and Legal Arrangements - Trinidad and Tobago is a thriving centre for commercial activity. It has a very active Registrar General’s Department (RGD) that oversees the registration of companies, NPOs and the registration of business names amongst other functions. A publicly searchable electronic database for general records of the RGD has been invaluable in increasing accessibility to basic information on companies. Some beneficial ownership information is kept and made available but the accuracy of this is questionable since there is no requirement in the Companies Act to demand and maintain such information. Trinidad and Tobago is not a major centre for legal arrangements. Recent improvements in the filing of annual returns has improved the accuracy of records within the RGD and the verification process but there is still significant room for improvement. No risk analysis pertaining to legal arrangements has been done.

International Cooperation – FIUTT has been working effectively to use mechanisms to share, exchange and respond to requests for information. The FIUTT is able to share information spontaneously. LEAs have not maximised the possibility of exchanging information with their foreign counterparts. Both the BIR and the Customs and Excise Division have limitations in providing or obtaining information from foreign counterparts. Requests for information are not always processed in a timely manner. All the provisions of the Vienna Convention, the Merida Convention, the Terrorist Financing Convention and the Palermo Convention need to be given effect to. A proper case management system does not exist for either mutual legal assistance or extradition cases. There are some limitations in the Mutual Legal Assistance Act that may affect the provision of information.

 

US Department of State Money Laundering assessment (INCSR)

Trinidad and Tobago is categorised by the US State Department as a Country/Jurisdiction of Primary Concern in respect of Money Laundering and Financial Crimes.

OVERVIEW

 

Trinidad and Tobago’s close proximity to drug producing countries, relatively stable economy, and developed financial systems make it a target for criminals looking to launder money. Proceeds from drug trafficking, illegal arms sales, fraud, tax evasion, and public corruption are the most common sources of laundered funds and are derived from both domestic and international criminal activity. Narcotics trafficking organizations and organized crime entities, operating locally and internationally, control the majority of illicit proceeds moving through the country.

 

There have not been any money laundering convictions to date, although the Police Service Financial Investigations Branch continues to bring cash seizure and forfeiture cases to the courts. Trinidad and Tobago institutions encompassed in the AML regime continue to be challenged due to capacity and resource constraints. Sustained capacity building, ensuring adequate legislation, regulating the gaming industry, and increasing cooperation among law enforcement entities, the FIU, and the judiciary would greatly improve AML investigations and the rate of convictions.

 

VULNERABILITIES AND EXPECTED TYPOLOGIES

 

Trinidad and Tobago’s AML regime is unable to quantify the extent to which fraud and public corruption contribute to money laundering. Fraud and waste in government procurement have been identified as problems, but rarely result in convictions. The failure to prosecute financial crimes successfully has a corrosive impact on the integrity of public finances and may encourage others to engage in financial crimes.

 

Money laundering also occurs outside the traditional financial system. While public casinos and online gaming are illegal in Trinidad and Tobago, gamblers take advantage of “private members’ clubs,” which operate as casinos and are able to move large amounts of cash due to Trinidad and Tobago’s lack of adequate AML supervision of this sector. Reports also suggest that certain local religious organizations are involved in money laundering. STRs reviewed by the FIU and Customs and Excise Division officials indicate that TBML occurs.

 

There are 17 FTZs in Trinidad and Tobago, where manufactured products are exported. Companies must present proof of legitimacy and are subject to background checks prior to being allowed to operate in the FTZs, and while operating are required to submit tax returns quarterly and audited financial statements yearly. There is no evidence the FTZs are involved in money laundering schemes.

 

Trinidad and Tobago does not have a significant offshore banking sector. The volume of money laundering in the offshore banking sector is unknown. Currency transactions below the STR threshold are common.

 

KEY AML LAWS AND REGULATIONS

 

Trinidad and Tobago has fairly comprehensive KYC and STR regulations.

 

Trinidad and Tobago is a member of the CFATF, a FATF-style regional body.

 

AML DEFICIENCIES

 

The Attorney General’s office is committed to addressing legislative deficiencies and has prioritized AML investigations and prosecutions. Trinidad and Tobago needs to consistently comply with international standards regarding its legal and regulatory frameworks and to demonstrate commitment to enforce AML laws. Trinidad and Tobago should improve its capacity to investigate and prosecute money laundering cases successfully in order to increase its conviction rate.

 

ENFORCEMENT/IMPLEMENTATION ISSUES AND COMMENTS

 

Trinidad and Tobago currently has 13 financial prosecutions and no convictions to date. AML stakeholders continue to face many challenges, and Trinidad and Tobago has taken steps to address deficiencies. In 2016, Trinidad and Tobago appointed a Seized Assets Committee, to establish regulations and management of monies seized under the Proceeds of Crime Act.

 

Trinidad and Tobago continues to address additional AML legislative deficiencies. The country is in its third and final phase of its national risk assessment (NRA). The NRA will identify risks and vulnerabilities to the AML regime and guide Trinidad and Tobago in applying mitigating measures.

 

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SANCTIONS

There are no international sanctions currently in force against this country.

 

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BRIBERY & CORRUPTION

 

Index

Rating (100-Good / 0-Bad)

Transparency International Corruption Index

35

World Governance Indicator – Control of Corruption

36

 

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INVESTMENT CLIMATE - Executive Summary (US State Department)

Trinidad and Tobago (TT) is a high-income developed country with a GDP per capita of over US $20,000 and an annual GDP of $24 billion. Within the English-speaking Caribbean Community (CARICOM) group, it has the largest economy, and it is the third most populous country with a population of approximately 1.3 million. The Central Bank of Trinidad and Tobago and the International Monetary Fund predict 2.5 percent gross domestic product growth for TT in 2014. This follows growth of 1.5 percent in 2013, a year marked by several planned maintenance shutdowns in the energy sector.

Energy exploration and production drive the TT economy. In 2012, the energy sector accounted for approximately 40 percent of the country’s GDP and 80 percent of its export earnings. TT is the world’s largest exporter of ammonia and methanol, and one of the largest exporters of liquefied natural gas (LNG). Besides the energy sector, the biggest economic contributors are the manufacturing and services sectors. The official unemployment rate is between 5-6 percent; but this understates real unemployment due to extensive government make-work programs.

Government policies seek to encourage diversification away from dependence on the oil and gas sector and to stimulate those non-energy sectors with the greatest potential for growth. Targeted sectors include tourism, information and communications technology, creative industries, maritime industries, manufacturing, and agriculture.

Trinidad and Tobago has a favorable and open investment climate and most investment barriers have been eliminated. TT has a stable democratic political system and an educated English-speaking workforce. The commercial banking system is stable, well-capitalized and profitable, as is the insurance industry. Rule of law and respect for contracts are established in business practices.

While TT has reasonably well-developed infrastructure and efficient government services, the pace of reform in many areas has been slow. Legislation on a government procurement policy has been in process for ten years. Trinidad and Tobago has an independent judicial system that is competent, procedurally and substantively fair, and reliable. It is, however, backlogged and over-encumbered, which can make the resolution of legal conflicts time-consuming. The decision-making process for tenders and the subsequent awarding of contracts can at times turn opaque without warning, despite best efforts by the proposing company to fulfill all compliance requests. While the overall investment climate remains strong, a few foreign investors report encountering problems when their company’s interests run contrary to those of competing State-owned enterprises.

Crime, particularly violent crime, continues to be a deterrent to the establishment of new businesses and international investment. Successive governments have unveiled strategies to curb the high crime rates and reduce violent crime, but the implementation and sustainability of these efforts are lacking.

Despite these shortcomings, the government’s planning and development policy focuses on the promotion of an environment for growth and competitiveness on a foundation of macroeconomic stability. As stated in the Ministry of Trade, Industry, and Investment’s new advertising campaign, they are “Moving from Red Tape to the Red Carpet” to attract investors to Trinidad and Tobago.