The Financial Action Task Force (FATF) is an inter-governmental body established in 1989. Its mandate is to set standards and to promote effective implementation of legal, regulatory and operational measures for combating money laundering and the financing of terrorism and proliferation of weapons of mass destruction and other related threats to the integrity of the financial system.
The FATF has set out recommendations in order to combat money laundering and the financing of terrorism and proliferation of weapons of mass destruction. These recommendations have been adopted by over 180 countries and are universally recognised as the international standard for anti-money laundering and countering the financing of terrorism. The Dutch Kingdom is takes part in the FATF. Sint Maarten in his turn, as part of the Dutch Kingdom, participates as well in the FATF.
According to FATF Recommendation 29, countries who participate in the FATF should establish a Financial Intelligence Unit (FIU).There are three types of FIUs:
- 1. Administrative FIU: autonomous operating entity that receives, analyses and disseminates unusual or suspicious transactions.
2. Hybrid FIU: entity that receives, analyses and disseminates suspicious transactions, but the law enforcement has direct access to that registry.
3. Police FIU: law enforcement agency that manages the suspicious transactions registry.
The Sint Maarten FIU receives and analyses unusual transaction reports and other information relevant to money laundering, terrorist financing and associated predicate offences and supervises designated non-financial businesses and professions.The FIU also disseminates the results of aforementioned analysis. The Dutch abbreviation is the MOT (Meldpunt Ongebruikelijke Transactie).
The Sint Maarten government opted in it's law for the reporting of unusual transactions. The FIU has an automated registry where mentioned unusual transactions reports are held.
The FIU's functions as an administrative buffer between the reporting entities on the one hand and the law enforcement on the other hand. The FIU is established because of the necessity of having an entity that, with its analysis, gives added value to the (financial) transactions of the service providers in order to determine whether there is a suspicion of money laundering of terrorism financing. When that suspicion is confirmed, the suspicious transactions are forwarded to the Public Prosecutor’s Office.
According to FATF Recommendation 28, the Designated Non-Financial Businesses and Professions (DNFBPs) should be subject to supervision to ensure compliance with the anti-money laundering and terrorist financing requirements. The FIU Sint Maarten is the supervisory body for this group of institutions.
The supervision of these institutions is based on national law which in turn is based on the FATF Recommendations. The two relevant ordinances are the National Ordinance Reporting Unusual Transactions (O.P. 2013, CT no. 479) and the National Ordinance Identification when Rendering Services (O.P. 2013, CT no. 480). One of the supervisory powers the FIU has is to instigate an investigation on-site to determine whether the DNFBP is compliant or non-compliant. In case of non-compliance, enforcement measures can be imposed on the DNFBP.