Paris, 3 January 2018 – Mexico has a good system to tackle money laundering and terrorist financing, but should step up efforts in pursuing launderers and confiscating their assets to mitigate the significant risks.
The International Monetary Fund (IMF) conducted an assessment of Mexico’s anti-money laundering and counter-terrorist financing (AML/CFT) system, based on the 2012 FATF Recommendations, and using the 2013 Methodology. The FATF adopted the resulting Mutual Evaluation Report of Mexico - 2018
Mexico has a mature AML/CFT regime, with a correspondingly well-developed legal and institutional framework. The country faces a significant risk of money laundering, stemming principally from activities most often associated with organized crime, such as drug trafficking, extortion, corruption and tax evasion. Overall, Mexico has good AML/CFT preventive measures, mitigating measures for terrorism financing, and efficient international cooperation channels.
Most of the key authorities have a good understanding of ML and terrorist financing risks, and there is generally good policy co-operation and coordination. The Financial Intelligence Unit functions well and is producing good financial intelligence which competent authorities regularly access to. However, this financial intelligence does not often lead to investigations of money laundering, underlying crimes, and terrorist financing.
The financial sector supervisors have a good understanding of the risks the sector faces, and have implemented reasonable risk-based approaches to AML/CFT supervision. Financial institutions generally understand the risks they are exposed to and the actions they must take to mitigate them and have improved the quality of their suspicious transaction reporting over the past few years. Oversight of designated non-financial businesses and professions is not very developed and significantly under-resourced and there is a low level of suspicious transaction reporting. Generally, Mexican authorities have not applied regulatory sanctions, in an effective, proportionate and dissuasive manner across all sectors.
Despite the fact that Mexican authorities recently conducted some high-profile investigations, they are not investigating and prosecuting money laundering in a proactive and systematic fashion, but rather on a reactive, case-by-case basis. They do not systematically pursue confiscation of proceeds and instrumentalities as a policy objective, and not commensurate with the money laundering and terrorist financing risks.
A serious concern across all sectors is that beneficial owners are being identified only to a limited extent, systematically weighing on entities’ effectiveness in assessing and managing money laundering and terrorist financing risks.