Nicaragua

New Documents

The Financial Action Task Force of Latin America issued a fourth follow-up report for Nicaragua, which re-rates the jurisdiction on Technical Recommendations 8, 22, 23 and 28.

The Financial Action Task Force of Latin America released a second enhanced follow-up report for Nicaragua, stating that the jurisdiction has made progress in improving compliance with Financial Action Task Force Recommendations 5, 11, 20, 21, 22, 23, 24, 26 and 28.

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Important Facts

  • The U.S. State Department identifies Nicaragua as a major money laundering country, especially since the jurisdiction is transit nation for illegal narcotics. Money laundering methodologies facilitate government corruption and international organized crime groups’ trafficking of illegal narcotics, mostly cocaine. Such illegal trafficking and money laundering escalated in 2019 due to U.S. sanctions, pressuring certain economic actors to import assets through unregulated channels. Other methods of money laundering include traditional forms such as real estate transactions, sale of vehicles, livestock farming, money transfers, lending, and serial small transactions. Risks of illicit finance are heightened due to: informal “cash and carry” networks that deliver remittances from abroad; market vendors that deal in cash; the existence of multiple, nontransparent, quasi-public businesses that manage large cash transactions and have ties to the ruling party, and the proliferation of shell companies. Money laundering is additionally prevalent due to the Nicaraguan government's unwillingness to investigate sanctioned individuals and its decision to harbor high-profile former foreign officials accused of corruption and financial crimes.
Source: 2020 International Narcotics Control Strategy Report (INCSR)

Rankings

FATF i | 2013 Methodology

Technical Effectiveness
Compliant : 7 High : 0
Largely Compliant : 28 Substantial : 1
Partially Compliant : 5 Moderate : 7
Non-Compliant : 0 Low : 3

Nicaragua's technical compliance was re-rated in a January 2020 follow-up report

BASEL i

Rank : 16/141
Score : 6.78/10

TRANSPARENCY INTERNATIONAL i

Rank : 161/180
Score : 22/100

Tax Justice Network i

Rank : N/A
Score : N/A