Panama grey listing a threat to financial sector

PANAMA’S INCLUSION  on a grey list by the Financial Action Group is “a threat to the financial sector” says Minister of Economy and Finance Dulcidio De La Guardia.

Panama banks have been facing harder times doing business with their counterparts in the United States since the country was included on the group’s grey  list.

De La Guardia  stressed the importance of leaving the grey list as one of the keys to regaining “lost ground” in this relationship.

Panama was included on the list in June 2014, and in August was listed as a country of high risk by Fincen, a unit of the US Treasury Department, the equivalent to the Panamanian Financial Analysis Unit.

This has meant that US banks doing business in Panama have to complete extended due diligence measures, which increases costs. This has prompted some banks to alter their relationships with local banks due to the costs.

Panama has been working since last year with the Financial Action Group to strengthen its legal framework against money laundering.

De La Guardia said that a meeting with officials from that organization is tentatively scheduled for Jan. 12-14.

The meeting is being held to verify that Panama has taken the steps agreed upon, which could lead to the country being removed from the list at the group’s February meeting in Paris.

De La Guardia said that, in informal conversations with US banks, exiting the grey list will be the key to them resuming relations with institutions within Panama reports La Prensa