Financial task force keeps Panama on its gray list

Panama has not corrected financial deficiencies and will remain on the Financial Action Task Force’s (FATF) gray list.

While the intergovernmental organization recognized progress, “all deadlines have now expired and work remains.”

The country presented an action plan in 2019 to confront shady finance.

In January 2018, Panama was taken off the black list, and the government taking office a year later pledged to get the country off the gray list.

Countries on the gray list face restrictions in the financial services sector, with impacts on the economy.

FATF, which was set up to combat money laundering and terrorism financing, said Panama needs to do more in exposing corporate money laundering and terrorism finance, for ownership verification, offshore record keeping, and prosecute foreign tax crimes more strictly, among others.

Dani Kuzniecky, technical secretary of the financial crimes commission (CNBC), told local media, “it is essential that the country succeed in conducting anti-money laundering investigations and that they end in exemplary convictions.”

Panama made tax evasion above a certain level a criminal offense in 2019.

The Panama Papers leak in 2016 is still affecting the country’s image.

“We have to act urgently because failure to do so has serious consequences for the country when it comes to making Panama's international financial center competitive, and attracting foreign investment to the country,” Kuzniecky said.