Tuesday, December 19, 2017

Mexico numero uno for Money Laundering

A draft report by the Financial Action Task Force (FATF), an international organization that sets global standards for fighting illicit finance, blasts Mexico and it's feeble attempts to prosecute money launderers. Tax authorities are hopelessly lax with potential drug money fronts such as real estate and luxury goods firms.

Mexico is the top source of illegal drugs to the United States and authorities have been criticized for leaving drug gang finances almost entirely intact.
The 200-page report commends efforts to clean up the Mexican banking sector after U.S. led investigations in the mid-2000s revealed global banks processed billions of dollars in drug gang cash. Officials say tighter regulations flushed illicit money from the banking system. However, the report says Mexican tax authorities do virtually nothing outside the financial sector, such as real estate.

Since 2014, Mexico’s tax authority has had powers to audit more than 64,000 businesses considered to be high risk. Since then 118, or less than 0.2 percent have been audited.
Mexico is making little headway in seizing illicit cash, according to the government’s own estimates. Data in the report provided by Mexico shows the country seized just $32.5 million in 2016. That represents less than 0.1 percent of the $58.5 billion of illicit revenues the government estimates is generated by organized crime annually.

Mexico is at the very bottom of major countries in terms of its efforts to fight money laundering. Brazil has increased prosecutions fourfold and Colombia nearly sixfold. Mexico has seen the number drop.