Suspicious transactions and activity reports worth TT$1.9 billion were noted locally by the Financial Intelligence Unit (FIUTT) over the last fiscal year—and there’s need for improved compliance by the credit union sector in filing Quarterly Property Terrorist Reports (QPTRs).
Also, law is coming to regulate, supervise and monitor virtual assets and virtual assets service providers.
Finance Minister Colm Imbert indicated this in Parliament yesterday, as he detailed the FIUTT’s annual report for the year ending September 2022.
Imbert said the FIUTT had continued using the intelligence provided from the analysis of Suspicious Transaction Reports/Suspicious Activity Reports (STRs/SARs) to ensure entities’ compliance with the Anti-Money Laundering/Counter Financing of Terrorism/Counter Proliferation Financing (AML/CFT/CPF) legal obligations.
During the reporting period, Imbert said the FIUTT received 958 STRs/SARs, representing a decrease of 42 per cent compared with the same period one year prior.
The total monetary value of the 958 STRs/SARs received was $1,937,211,057.
Imbert said the banking sector submitted 76 per cent of the STRs/SARs, followed by the Money of Value Transfer Services (MVTS) sector and Co-operative Societies, accounting for 11 per cent and 5 per cent, respectively.
“Also, during the reporting period, submissions from the co-operative societies, investment companies, mortgage companies, MVTS, motor vehicle sales, real estate and private members’ clubs sectors all decreased due to the pandemic restrictions,” Imbert said.
“Overall, a 44 per cent decrease was noted in STRs/SARs submissions by financial institutions and a 21 per cent decrease in submissions from listed business (LBs).”
Of the 958 STRS/SARS, he said 844 (involving $1,586,346,802) were completed transactions, while some 195 (involving $350,864,255) were attempted transactions.
“This represented a 24 per cent decrease in completed transactions and a 68 per cent decrease in attempted transactions when compared to the previous reporting period. Of note, 16 STRs/SARs contained both completed and attempted transactions.”
The FIUTT noted an 83 per cent increase in submissions from jewellers, the only LB to record a significant increase in STRs/SARs submissions in the reporting period.
He said suspicious activity ranked the highest among the five most common reasons for the submission of STRs/SARs to the FIUTT, representing 301 persons.
This was followed by tax evasion (211 persons), fraud (196), money laundering (155) and drug trafficking (35). These accounted for 94 per cent of the total STRs/SARs received and 60 per cent of the total monetary value of all STRs/SARs submitted.
During the reporting period, the FIUTT completed analysis of 212 STRs/SARs, generating a total of 69 intelligence reports (65 suspected money laundering cases and four suspected financing of terrorism cases), of which 45 were “spontaneous disclosures.”
Thirty three were submitted to local authorities and 12 were shared with foreign law enforcement agencies and other financial intelligence units.
Imbert said while financial institutions are generally compliant with the obligation for quarterly property terrorist reports, “Based on a compliance analysis of QPTR submissions, there’s need for improved compliance by the credit union sector.”
Imbert said some 88 per cent of non-regulated financial institutions under the FIUTT—credit unions, building societies and MVTS —were tested for compliance on AML/CFT/CPF.
There was a high level of compliance by entities on receipt of warning letters. But, “Conversely, the level of response by the credit union sector regarding failure to submit QTRs requires a more focused approach.”
Imbert added, “Further legislative amendments will be introduced in areas such as the extension of the range of sanctions to include administrative fines in the AML/CFT/CPF regime; the introduction of AML/CFT/CPF Regulations formulated specifically for non-profit organisations; further amendments to the FIUTTA.”
He said legislative developments will include the regulation, supervision and monitoring of virtual assets and virtual assets service providers for both AML/CFT/CPF and prudential measures; and the introduction of a Currency Threshold Reporting regime for reporting entities.”
Terrorist financing flagged frequently
The Financial Intelligence Unit of T&T (FIUTT) received 16 requests from foreign authorities during the reporting period, representing a 45 per cent increase compared to the previous reporting period.
These requests featured a total of 85 subjects in contrast to the 26 recorded in the previous year.
“The suspected criminal conduct in the majority of cases was financing of terrorism related, with four of the requests seeking intelligence on 34 subjects.”
Finance Minister Imbert said the FIUTT made 23 requests comprising of 45 subjects to foreign authorities for financial intelligence and information.
“The requests made to foreign authorities involved 11 cases of suspected fraud and five cases of drug trafficking. Requests received from foreign authorities originated mainly from the Caribbean, the Middle East and Europe,” Imbert said.
“Similarly, the FIUTT sent the majority of requests to foreign authorities in the Caribbean, the Americas and Asia.”