Compliance
Mexico Fails To Address Key Money Laundering Risks, Says Corruption Watchdog

Typically, methods of money laundering in Mexico include the use of shell or front companies to conceal beneficial ownership; the purchase and sale of real estate and high-value goods and cash smuggling along the border, according to the Financial Action Task Force.
An international corruption watchdog and standard-setting body
has said that despite Mexico’s efforts to pursue some
high-profile cases, it fails to take a systematic approach to
addressing money laundering.
Mexico has a “mature” anti-money laundering and counter-terrorism
financing regime and it has upped its efforts since 2008.
However, the country “faces a significant risk” of money
laundering, stemming from organized crime such as drug
trafficking, extortion, corruption and tax evasion, according to
a new report by the Financial
Action Task Force (FATF).
Though Mexico’s financial services sector “demonstrates a good
understanding” of the primary money laundering threats from crime
groups, non-financial businesses have a “limited” perception of
risks entailed, the report stated.
“[Money laundering] is not investigated and prosecuted in a
proactive and systematic fashion, but rather on a reactive,
case-by-case basis, notwithstanding the fact that some
high-profile investigations have recently been conducted,” said
the Paris-based organization in its report.
The FATF sets global standards for tackling money laundering and
terrorism financing and ranks countries on their efforts to
stymie flows of dirty cash. Nations that fail to implement meet
its requirements risk being labeled as high-risk or uncooperative
jurisdictions.
Mexico’s Finance Ministry and Attorney General’s Office said in a
joint statement the FATF evaluation acknowledged Mexico has a
mature scheme in place for money laundering prevention and
fighting the financing of terrorism, but that it needs to work on
some aspects.
“The report indicates that the country faces risks mainly related
to money laundering and should therefore strengthen actions such
as giving priority to investigations, the seizure of illicit
goods, the supervision of vulnerable non-financial activities and
the identification of the end beneficiaries of assets and
companies,” the statement said.