HONDURAS: MONEY LAUNDERING IMPLEMENTATION GETS OFF

UNCLAS TEGUCIGALPA 002569

SIPDIS

PLEASE PASS TO TREASURY - OFFICE OF TECHNICAL ASSISTANCE

E.O. 12958: N/A
TAGS: EFIN EAID HO
SUBJECT: HONDURAS: MONEY LAUNDERING IMPLEMENTATION GETS OFF
TO A GOOD START

REF: TEGUCIGALPA 725


1. Summary. Three Treasury consultants held a seminar on
money laundering and financial crimes from August 24-26 for
40 judges, prosecutors, police investigators, Banking
Commission officials and bank compliance officers. The
seminar was well received by the Honduran participants and
the Treasury consultants commented that there is good
cooperation among the different GOH entities responsible for
enforcement of the law. The Financial Information Unit is
up and running and investigating 25 cases of suspected money
laundering. One of these cases is being prepared for
prosecution. End summary.


2. From August 24-26, three consultants (Jim Parrott,
Ronald Cleaver and Gary Kruchten) from the Department of
Treasury's Office of Technical Assistance held a seminar in
Tegucigalpa on money laundering and financial crimes for 40
judges, prosecutors, police investigators, Banking
Commission officials and bank compliance officers. The
Treasury consultants commented that they were impressed with
the quality of the questions raised and the level of
interest among the participants. The seminar was the third
money laundering technical assistance visit by Parrott to
support the GOH as it implements its strengthened money
laundering legislation (reftel). In April, Parrot reviewed
the law that had been adopted by the National Congress and
met with Banking Commission officials, prosecutors, the
Supreme Court and the banking association to do a technical
assistance needs assessment. He returned with an attorney
from NAS Guatemala to provide an overview of the operations
of an FIU and spent time with prosecutors and Banking
Commission officials reviewing draft implementing
regulations.


3. Treasury is currently planning a trip (tentatively
programmed for November) for Financial Information Unit
(FIU) officials and the prosecutor assigned to the FIU to
visit a successful FIU in Latin America (possibly Colombia).
Treasury is also talking with FINCEN about arranging for a
computer expert to travel to Tegucigalpa to advise Honduran
FIU officials on organizing and upgrading their computer
system. Embassy hopes to continue to use Treasury
consultants to provide training to GOH authorities (banking
officials, prosecutors, judges, police) on money laundering,
financial crimes and investigative techniques and envisions
a one to two-year technical assistance program, provided
funding is available.


4. The FIU is up and running and currently investigating 25
cases of suspected money laundering. One of the cases is
being prepared for prosecution. The FIU consists of five
officials, including three analysts and one full-time
prosecutor. Both the prosecutors and Banking Commission
officials commented on the constructive working relationship
within the FIU.


5. Of concern to the Treasury consultants was the physical
security of the FIU. There is currently uncontrolled access
to the computer systems and sensitive banking information,
compromising not only the security of the FIU but also
hindering information sharing among regional FIU's and
FINCEN. Banking Commission President Ana Cristina de
Pereira agreed to take measures to improve the FIU's
physical security. However, budget restrictions (the
Banking Commission's 2002 budget did not include money for
upgrades to the FIU) may limit what the Banking Commission
can do in the short-term to upgrade security. Pereira
remarked that she would request money in the Commission's
2003 budget for a comprehensive FIU security upgrade.


6. Post would like to thank Treasury for its extremely
timely and helpful support in ensuring implementation of the
GOH's strengthened money laundering legislation.

Pierce