Mexico not doing enough to prosecute money launderers

Mexico must up its game in terms of investigating and prosecuting people suspected of money laundering or terrorism financing.

That's according to a report produced by the IMF and adopted by inter-governmental body the Financial Action Task Force (FATF).

The country faces a "significant risk" of money laundering, stemming mainly from activities such as drug-trafficking, extortion, corruption and tax evasion, the FATF said in a statement.

The IMF assessed the effectiveness of Mexico's anti-money laundering and counter-terrorist financing (AML/CFT) system.

Mexico, FATF said, 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."

It said: "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."

Financial sector supervisors have implemented "reasonable risk-based approaches to AML/CFT supervision," FATF said. Banks are most at threat, the IMF report said. Brokerage firms, notaries and real estate agents are also among sector players exposed.

In response, Mexico's finance ministry said in a statement it was committed to protecting the national financial system and addressing issues raised in the report.

The country is developing a national strategy based on the findings of a national risk assessment that concluded in June 2016. "The success of these measures will depend on their proper implementation," the IMF report said.

Read the executive summary of the IMF report