Banking in Paradise: Money Laundering, Economic Sanctions, and the Puerto Rican Tax Haven

• In Event: Money Laundering and Fraud Around the World

Abstract

This paper develops a critical criminological analysis of the legal and financial processes that transformed PR into a center for international banks and financial institutions. In 2012, the PR government legislated a new law (Act 273) that allowed international financial institutions and banks to move to PR. As a result, 80 international banks have moved to the archipelago. This paper discusses how this legislation has enabled some individuals and corporation to avoid US economic sanctions. The paper discusses the following aspects: 1) the laws and tax policies developed by the PR and US governments; 2) a study of the banks and the services that they provided, and their impact on the economy; 3) a discussion of the bankers and local law firms that serve as intermediaries between International banks and the local governments; and 4) the US, EU, and international interventions with banks established in PR for money laundering. All of this is largely embedded in the logics of exceptionality and inclusive-exclusion in which the economic development and the management of the Puerto Rican multilayered crisis have been based.

Author

• Jose Atiles, University of Illinois Urbana-Champaign