The Cost of Being a “High Risk” Country

The bottom line is that the increased costs to our foreign financial systems due to some BS agency in the EU is passed on to the consumers.

The inclusion of Panama in the list of high-risk countries with strategic deficiencies in the battle against money laundering and terrorism would increase the operating costs of foreign banks in the country.

A few days ago, the European Commission included the Central American country in a list of 23 nations classified as territories with lax measures and controls against money laundering and financing of terrorism.

See “Panama Does Not Want to Be a ‘High Risk’ Country‘”

Risk rating agency Moody’s prepared a report called “Panama´s inclusion on Commission watchlist for lax controls in credit negative for its offshore Banks“, which was published on February 15, 2019.

According to Elcapitalfinanciero.com, the rating agency’s report explains that “… financial and banking institutions will need to increase controls over the transactions performed with their clients, allowing them to identify suspicious transactions.”

The article adds that “… The inclusion of Panama in the new EU black list will increase the scrutiny of European correspondent banks in dealing with banks in the Panamanian square, generating additional operating costs. In addition, some correspondents could reduce or terminate their relations with the CBI of Panama.”