“Is Uruguay prone to money laundering and corruption?” former Attorney General asked

On Thursday, October 6, former Uruguayan court prosecutor and former Organized Crime judge Jorge Diaz said during a colloquium in Montevideo that Uruguay is “an ocean” away from the anti-corruption standards suggested by the Organization for Economic Cooperation and Development (OECD).

“If we compare the huge difference between OECD standards and Uruguayan anti-corruption regulations, we will find that there is something like an ocean.

“Therefore, Uruguay is far from international standards in anti-corruption matters.

“It is a fact of reality,” Diaz said during an event organized by Brum-Costa Abogados, a local law firm of reference in anti-money laundering prevention.

“I don’t want to make any political criticism, but several governments have passed, and no one has bothered to adjust those regulations,” he added.

Díaz’s presentation was based on how to prevent internal fraud in companies and organizations, although before delving into that issue, he spoke about the general situation in Uruguay.

Díaz was for nine years head of the Attorney General’s Office in Uruguay, a position he left last year to work in private practice when he joined the Brum-Costa law firm. Previously, he had been in charge of Organized Crime and Criminal Courts, among others.

The president of the National Secretariat for the Fight against Money Laundering and Financing of Terrorism (Senaclaft), Jorge Chediak, was also present at the event.

The official, a former president of the Supreme Court of Justice, said there is “a lot of work ahead to be relatively well positioned” for the next round of evaluations by the Financial Action Task Force (Gafi).

The round will begin in 2024, but Uruguay’s round has no date yet.

Senaclaft’s audit supervisor, Gustavo Misa, said in turn that “certain weaknesses” are “quite worrying.”

“We have found that very few of the regulated entities in the non-financial sector carry out a risk analysis of the client and the operation.

It is not minor,” he said. He also said that it is common not to search in lists or open sources on a person’s background, as the regulations require.

THE ADVANCE OF ORGANIZED CRIME IN BRAZIL AND ARGENTINA

Meanwhile, the external advisor to the Uruguayan anti-money laundering secretariat, Alejandro Motesdeoca, pointed out that the expansion of organized crime in Brazil and Argentina raised additional warning lights in Uruguay due to the potential for the development of illicit business networks further south.

“Our environment is going to be even worse. The organized crime situation in Argentina, Paraguay, Bolivia, and Brazil – let’s see, the triple border is coming down the Paraná-Paraguay-Uruguay waterway, and it is coming down the dry border.

“With all the problems: organized crime, drug trafficking, even committing crimes. So this is a problem,” he said.

The expert also pointed out that Gafi requires aspects “that cannot be fulfilled,” representing a “great challenge” for the countries.

“We are between a rock and a hard place in the face of the serious difficulty of complying and, on the other hand, the risk of getting on the list because they do not comply,” he said.

As reported by El País, during an appearance before Parliament in June, Montesdeoca had pointed out that Uruguay had “moderately” complied with the aspects evaluated by Gafilat in the last round, thus avoiding entering a “gray list”.

However, said the expert, there is still some way to go.

LUC DEBATE: “THE NON-FINANCIAL SECTOR IS DEMOBILIZED”

Daniel Espinosa, former national anti-lending secretary during the Frente Amplio government, said that Uruguay must move forward in detecting “proactive cases” beyond alerts that arise abroad.

Espinosa was critical of changes introduced by the government of Luis Lacalle Pou through the Urgent Consideration Law.

On the one hand, he questioned the authorization of non-financial subjects to apply simplified due diligence when the operation is carried out using electronic means such as bank transfers, provided that there are no high-risk factors.

On the other hand, he pointed to the fact that the cash payment of any business or operation was extended up to US$100,000.

“What I notice is that the non-financial sector is demobilized. And that the issue of money laundering does not have the importance it should have for these sectors if we want to have a balanced system, where not only the financial system works,” said the former anti-money laundering official.

Misa, currently Senaclaft’s supervision supervisor and who shared the panel with Espinosa, defended the modifications and said there is not enough time to know if the impact of the change was significant in the case detection system.

The official said there is a presumption of low risk when the money comes from banked sources.

With information from Bloomberg Línea

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