White-Collar Crime 2024 Comparisons

There are two categories of punishable behaviours in our country: minor offences, known as administrative infractions, and more serious offences, called crimes.

Both administrative infractions and crimes are defined in legal regulations, the former in the Administrative Code and the latter in the Criminal Code. In both types of offences, the intention to commit the criminal act is punished, and in exceptional cases, negligence or fault that results in criminal consequences is also punished. In Panama, it is not necessary for the criminal result to be achieved, as the attempt to commit the crime is also punished.

In white-collar criminal proceedings, the burden of proof lies with the Prosecutor, and during the course of the investigation and until a verdict declaring guilt is issued, the person under investigation is presumed innocent. The Prosecutor must prove that a crime has been committed and must also present evidence that demonstrates that the accused person is guilty of its commission. The current evidentiary standard in our country is that the trial court must, in order to issue a guilty verdict, ascertain that what has been argued in relation to the evidence has been sustained beyond all reasonable doubt. If there is doubt, the defendant must be acquitted.

The general principle in Panama is that the maximum period for investigation is equivalent to the maximum term of imprisonment provided for each crime. For those offences that are not punishable by imprisonment, the maximum period for investigation is three years. For crimes against the public administration (including corruption, embezzlement of public funds/property and abuse of authority), the period is double the maximum term of imprisonment imposed for these crimes.

In white-collar crimes, Panamanian authorities only have jurisdiction over offences that occur within the national territory. Exceptionally, the Criminal Code provides the possibility for a Panamanian authority to investigate and judge acts committed outside the national territory, such as crimes against humanity, public health and the national economy, among others.

International Instruments and the Application of Criminal Law

There are a series of instruments that have been signed between the Republic of Panama and various countries relating to mutual legal assistance, extradition and investigative co-operation.

According to the National Constitution, the Panamanian Government cannot extradite its nationals to other countries, which would be an obstacle to prosecuting white-collar crimes that occur outside Panamanian territory. Foreigners, on the other hand, cannot be extradited for political reasons.

A legal entity can be subject to criminal liability when it is created or used to commit a crime. However, in our legal system, it is not possible for the legal entity itself to commit a criminal act; it is the natural person who created or used the legal entity to commit the crime who is capable of guilt. This person is usually punished with imprisonment, but also in some cases, the law allows the legal entity involved in the criminal conduct to be sanctioned, such as through fines, suspension of operations, or dissolution of the company.

Liability of the Legal Person and the Natural Person: Differences

Regardless of the type of investigation, our legal system does not establish a difference between investigating legal or natural persons; both will receive the same treatment, and their rights will be respected. But directors and officials (legal representative, president of the board, manager, CEO) of a corporation would only be held responsible for a criminal act is if it is proven, beyond reasonable doubt, that they knew the company was created or used to commit the criminal act or if they maintained some degree of participation in the crime as authors or accomplices.

In our country, according to the application of the criminal law over time, punishment is based on the law at the time the criminal act was committed. Therefore, the fact that the company created or used to commit the crime was acquired by or merged with another company does not make the acquirer or counterpart in the merger responsible for a criminal act committed in the past.

Our legal system includes a series of guidelines as to what must be considered when determining a penalty. For example, factors such as whether the perpetrator has a criminal record, the severity of the crime, and the existence of a relationship between the perpetrator and the victim are taken into account. Once the penalty has been set, and subject to the fulfilment of certain requirements, it is possible for a prison sentence that has been declared to be suspended or replaced by another form of penalty, so that the perpetrator may receive a different type of punishment and not go to jail. There is also the possibility that, before the judge issues a judgment, the Prosecutor and the accused person can reach a plea agreement. This agreement results in a mandatory reduction of up to one-third of the penalty described in the law as the basis for the Prosecutor to negotiate the reduction. In Panama, there are also collaboration agreements, which empower the Prosecutor to dispense with the criminal prosecution in its entirety or grant reductions in the sentence on condition of the accused providing testimony or information relevant to the case.

In order to claim compensation, the victim of the crime must prove, first, the occurrence of the crime and, second, that the crime caused them damage and harm. It is necessary for the victim to prove the amount of damage and harm they claim to have suffered as a result. The trial court is responsible for convicting a person of a crime and at the same time declaring civil liability arising from the criminal act. There is no class action procedure in our criminal jurisdiction; unfortunately, class actions are only found in consumer protection civil actions under Law 45 of 2007.

There is no civil or administrative enforcement in criminal investigations (although evidence of crimes may arise from the investigation of administrative offences, which evidence would need to be sent to the Prosecutor for criminal investigation and/or prosecution). Only the criminal authorities, specifically the Prosecutor’s Office, have the competence to investigate white-collar crime.

Under the laws on compliance and on prevention of money laundering, financing of terrorism and financing of the proliferation of weapons of mass destruction, a series of powers have been created for the control entities, namely the Superintendency of Banks and the Superintendency of Non-Financial Entities. They gather and have the duty to provide information to the prosecutors for the early detection of money laundering, financing of terrorism and financing of the proliferation of weapons of mass destruction.

Investigations of white-collar crimes can be initiated ex officio, by complaint or by direct accusation. This means that authorities can start an investigation on their own initiative, or in response to a complaint filed by an individual or entity, or based on a formal accusation made by an interested party. This approach allows for more flexibility and effectiveness in the detection and prosecution of such crimes, ensuring that appropriate measures are taken regardless of how the crime is discovered.

The authorities responsible for investigating white-collar crime have broad freedom to conduct any type of investigation, if it relates to the facts under investigation. However, they must avoid making broad or vague requests for information in the hope of uncovering incriminating evidence by chance rather than through targeted investigation. Authorities and prosecutors must be careful not to engage in fishing expeditions that lack specific grounds or probable cause. Individuals and authorities are required to provide the information needed to investigate these crimes. The official in charge of the investigation has legal powers to execute all matters related to this inquiry.

Prior to the initiation of a criminal investigation, and in terms of prevention related to anti-money laundering (AML)/countering the financing of terrorism (CFT), obligated entities must take measures for registration, liaison, due diligence, and reporting of suspicious transactions. These obligated entities include:

• companies in the Free Zones in the Republic of Panama;
• casinos, operators of games of chance and betting systems, and other entities that do business over the internet;
• real estate promoters, agents and brokers;
• companies dedicated to construction, general contractors and specialised contractors;
• armoured transport companies;
• pawnbrokers;
• companies trading in precious metals or precious stones, including diamond exchanges;
• the National Lottery of Beneficence (LNB);
• mail services;
• companies engaged in the purchase and sale of new and used vehicles;
• lawyers and public accountants, when in the exercise of their professional activity they perform on behalf of a client any of the activities subject to supervision; and
• public notaries.

The above-mentioned entities, in matters of AML/CFT, must make a report of a suspicious transaction for any transaction that cannot be justified or substantiated against the financial or transactional profile of the client, or any transaction that could be related to money laundering, terrorist financing or the financing of the proliferation of weapons of mass destruction.

Internal investigations conducted by individuals or companies do not have the legal power to establish or prove the facts under investigation in a criminal case. Any element provided to the Prosecutor is considered an element towards conviction (but not evidence per se) and will help to clarify the facts; in turn, the fact of preparing prevention manuals can be considered as a bona fide action, part of the conditions of a suspension of the process subject to conditions of being the case and that an alternative method of conflict resolution is explored. Some types of internal investigations, such as audit reports, can be presented to the Prosecutor as evidence. In a criminal investigation, private statements are not considered evidence. The defendants have the right to a cross-examination, and the use of lie detectors is not valid in the official investigation. Any report made to control entities in the matter of preventing money laundering, financing of terrorism and financing of the proliferation of weapons of mass destruction is not considered evidence in a proceeding, but rather as indications for the Prosecutor in charge to carry out the necessary investigations to verify the commission of crimes.

White-collar prosecutions must be initiated by the Prosecutor. The Prosecutor has full legal authority to refrain from directing an investigation against a person or company involved in this type of crime, as long as the basis for that decision is that the company or individual will contribute to the process in order to uncover and sanction those with a higher degree of participation, if applicable.

Our criminal system begins with a preliminary investigation process, which can then lead to the formulation of charges. If the process continues, it will advance to a trial stage. Before this stage, it is possible to conclude the process through mediation, conciliation, withdrawal, suspension of the process subject to conditions, discretionary prosecution and plea agreements. As long as the crime allows it, in view of the list of withdrawable crimes in the Criminal Code, methods other than a penalty agreement could be explored. For example, the forgery of documents is a crime that can be withdrawn, just as intellectual property crimes can be subject to mediation, and even if it is explored in the appropriate way, the Prosecutor can decide to dispense with the action if it is of low importance to society. For example, the Prosecutor has the right not to continue with a criminal case for trademark counterfeiting, provided that the perpetrator reaches an agreement with trademark owner to pay damages.

Article 51 of the Criminal Code is the only rule that refers to the liability of legal entities and only contemplates sanctions for them, not penalties. Any crime included in the Criminal Code that refers to the involvement of an entity in a criminal conduct, whether by commission or omission, as long as it is proven that the legal entity was used or created for it, can carry the corresponding sanction, ranging from a fine to the dissolution of the same, without neglecting the attribution of criminal responsibility to those natural persons who had some dominion or control over the act.

The Criminal Code imposes severe penalties for various white-collar crimes. Document falsification, covered in Chapter I of Title XI of the Code, Crimes section, includes altering public and electronic documents, with penalties ranging from one to 15 years depending on the document type and severity.

Fraud under Article 243 involves the misuse of financial resources, and is punishable by four to eight years in prison, with harsher penalties for those exploiting their positions. The crime was designed for financial institutions, with aggravating circumstances for those who had the power to exercise such acts or were employees of trust.

Article 244 addresses the falsification of financial records, which is sometimes used to maintain or obtain credit facilities fraudulently. The Article imposes six to eight years of imprisonment.

The newly included crime of tax evasion, under Article 288-G, penalises intentional tax fraud with two to four years in prison, as long as the fraud exceeds USD300,000 within a calendar year.

Money laundering, detailed in Article 254, involves handling illicit funds from serious crimes and carries a penalty of five to 12 years in prison.

The above-mentioned additions to the law reflect Panama’s commitment to combating financial crimes and enhancing legal transparency. The existence of a preceding crime is at least indicatively necessary.

According to the Criminal Code, bribery involves the unlawful solicitation, acceptance, or offering of benefits to influence the actions of a public servant. Criminal law classifies bribery in the following way:

• Bribery (Article 345 of the Criminal Code): A public servant accepts, receives or solicits any form of benefit to perform, omit or delay an act in violation of their duties, or because of failing to fulfil their duties. This also includes accepting benefits to perform acts inherent to their position without failing in their duties.
• Bribery in Procedural Actions (Article 346 of the Criminal Code): A public servant in a judicial or administrative role accepts, receives or solicits benefits to harm or favour a party in a process. This includes issuing resolutions contrary to the law, giving legal advice to parties or maliciously delaying processes. If this results in the conviction of an innocent person, the penalties are more severe.
• Bribery for Giving or Offering (Article 347 of the Criminal Code): A person offers, promises or gives a public servant any benefit to influence their actions, whether to perform, delay or omit any act related to their duties.
• Inducement to Bribery (Article 352 of the Criminal Code): A public servant induces someone to improperly give or promise money or another benefit for their own benefit or that of a third party.

Under Article 354 of the Criminal Code, influence peddling involves the act of using one’s influence, or pretending to have influence, to solicit, receive or accept promises, money, goods, or any other economic or legal advantage. This is done with the aim of obtaining a benefit from a public servant or a foreign public servant of an international organisation in a matter they are managing or may manage.

These crimes must be committed intentionally, meaning that the public official who receives the bribe must be aware that they are receiving a benefit as a consequence of not fulfilling their obligations, thus favouring the briber. These crimes are punished with imprisonment and aim to protect the proper functioning of public administration.

Applicable Accessory Penalties

In addition to imprisonment, the person who receives the bribe is sanctioned with accessory penalties of disqualification from holding public office and the confiscation of the money, goods or objects received as a result of the bribery.

In Panama, there are pieces of legislation aimed at preventing bribery and influence peddling. These include Law 23 of 2015 (and its amendments) on the prevention of money laundering, financing of terrorism and financing of proliferation of weapons of mass destruction, which creates obligations on financial and non-financial obligated entities, the Anti-Corruption Law and the United Nations Convention against Corruption, among others. Additionally, there are regulations that relate to codes of ethics for public officials and integrity pacts that companies contracting with the State must sign. There are also disqualification rules in public contracting that apply to companies and their directors who commit, among other things, falsification and crimes against the public administration.

Supervisory bodies will verify compliance with the mechanisms for AML/CFT control, adopting a risk-based approach that allows for a clear understanding of the risks to which the obligated party is exposed. For this supervision, the bodies may request information and documentation from the obligated companies.

When implementing a risk-based approach, obligated parties must establish processes to identify, evaluate, monitor, manage and mitigate the risks of money laundering, terrorist financing and the financing of the proliferation of weapons of mass destruction.

The obligations for obligated parties in accordance with Law 23 of 2015 and its amendments and regulations are as follows:

Registration Obligation

Obligated parties must register with the relevant Superintendency, according to the procedure and fees it establishes.

Liaison Obligation

Obligated parties must designate a person or unit responsible for serving as a liaison with the Financial Analysis Unit (UAF) and the Superintendency. Until such a person or unit is appointed, the legal representative in the case of entities or the natural person will perform the liaison function.

The liaison will have the function of attending to the requirements and requests of the UAF and the Superintendency. The registration of the liaison will be regulated, in the case of vehicle traders, by the Superintendency, which will issue the guidelines and other functions that the liaison must fulfil.

Obligation to Adopt a Prevention Manual

Obligated parties must implement and adopt an AML/CFT Manual that allows for the implementation of policies, procedures and controls necessary to reduce exposure to the risks identified in their own risk assessments. These manuals must be approved by senior management, ie, partners, directors, officers, representatives, etc. These people will be obligated to monitor the implementation of internal controls, improving or reinforcing them, and they will be responsible for maintaining such internal control structures in their company.

Due Diligence Obligation

Obligated parties must take the necessary measures to identify, evaluate and understand their AML/CFT risks relating to clients, countries or geographic areas, products, services, transactions, or distribution or marketing channels.

In Panama, the issues of insider dealing, market abuse and criminal banking law are codified in the Criminal Code under Articles 238, 243 to 253, and 283. These provisions establish the legal framework for addressing and penalising such offences, ensuring the integrity and transparency of financial and market activities within the country.

On conducts that relate to insider dealing, Article 249 of the Criminal Code addresses the misuse of privileged information. It stipulates that anyone who, for personal gain or the benefit of a third party, improperly uses or discloses privileged information obtained through a privileged relationship, relating to securities registered with the National Securities Commission or traded in an organised market, causing harm, shall be punished with a prison sentence of six to eight years. For the purposes of this Article 249, confidential information is defined as information that, by its nature, can influence the prices of securities and has not yet been made public.

Additionally, Article 251 of the Criminal Code penalises the creation of false or misleading appearances in the trading of registered securities. It states that anyone who, with the intent of obtaining undue profit for themselves or a third party, makes deceptive offers to buy or sell registered securities, creates a false impression of active trading, or manipulates the market price of any registered security to facilitate its sale or purchase, shall be punished with a prison sentence of four to six years.

On market abuse, Articles 238 and 239 of the Criminal Code address market abuse and consumer protection. Individuals who withdraw or withhold essential raw materials or products from the market with the intent to create shortages or manipulate the prices of goods or services, thereby harming consumers, shall be sanctioned with imprisonment from two to five years

Also, those who, to the detriment of consumers, charge higher amounts for products or services measured by automatic devices or apparatuses shall be sanctioned with imprisonment of four to eight years.

Criminal Conduct in Approvals Outside the Parameters of the Banking Law

In Panama, specifically regarding insider trading, the Criminal Code stipulates that directors, managers, legal representatives or employees of financial institutions who approve credit or financing beyond legal regulations, potentially causing forced liquidation, insolvency or permanent illiquidity, face imprisonment of four to seven years. This penalty also applies to beneficiaries involved in the crime and is increased by a quarter if done for personal gain. Individuals who use or disclose privileged information for personal or third-party benefit, causing harm, face six to eight years of imprisonment. Privileged information is defined as confidential data that can influence securities prices and has not been made public.

Panama has taken a significant step in its fight against financial crimes by enacting Law 70 of 2019, which criminalises tax evasion. The Criminal Code stipulates that anyone who intentionally commits tax fraud against the National Treasury, affecting the accurate determination of a tax obligation to avoid paying taxes in whole or in part, shall be punished with two to four years of imprisonment. Under this regulation, any individual who intentionally evades taxes amounting to USD300,000 or more in a calendar year faces severe penalties, including a prison sentence of two to five years and a financial penalty ranging from two to ten times the amount evaded. This law aligns Panama with international standards set by organisations such as the Financial Action Task Force and aims to enhance the country’s compliance with global anti-money laundering and tax transparency norms. The regulation has been well received by local business associations and government agencies, as it strengthens Panama’s legal framework and helps maintain its international investment rating. By criminalising tax evasion, Panama has demonstrated its commitment to upholding the rule of law and fostering a transparent financial environment.

Articles 244 and 245 of the Criminal Code address financial record-keeping offences. Individuals who destroy, conceal or falsify accounting books, financial records or other financial information of a natural or legal person to obtain, maintain or extend credit or capital facilities from financial institutions, resulting in harm, can face six to eight years of imprisonment, and the same applies to those who use or benefit from falsified documents. These penalties are also applicable to those who destroy, conceal or falsify financial records or custody account entries of entities registered with the National Securities Commission or operating as investment advisers, investment companies or intermediaries, also resulting in harm.

With regard to competition-related crimes in Panama, Article 238 of the Criminal Code penalises individuals who withdraw or withhold raw materials or essential products from the market with the intent to create shortages or manipulate prices of goods or services, thereby harming consumers. The punishment for such offences is four to eight years of imprisonment. The Criminal Code also addresses the fraudulent billing of higher amounts for products or services measured by automatic devices, to the detriment of consumers, and imposes a prison sentence of two to five years for such actions. Under Law 45 of 2007, absolute and relative monopolistic practices are fined; nonetheless, these practices are not considered crimes as per the Criminal Code, and therefore can only be prosecuted in the civil courts and under the administrative procedures of the Antitrust Authority (ACODECO).

Article 13 of Law 45 of 2007 addresses absolute monopolistic practices, which are actions or agreements among competitors or potential competitors that restrict competition in various ways. These practices include fixing or manipulating prices, limiting the production or distribution of goods and services, and dividing markets among competitors. Additionally, it covers co-ordinating bids or abstentions in public procurement processes. Such practices are deemed harmful as they undermine fair competition, leading to inefficiencies and potentially higher prices for consumers. By identifying and prohibiting these actions, Article 13 aims to promote a competitive market environment, ensuring that economic agents operate fairly and transparently.

Relative monopolistic practices, as defined in Articles 15 to 19 of Law 45 of 2007, are actions by economic agents that diminish or impede free competition or market entry. These practices are considered illicit when they unreasonably displace other market participants, prevent market access or establish exclusive advantages for certain agents. The law outlines specific actions that fall under this category, such as exclusive distribution agreements, imposing resale prices, conditional sales, and collective pressure against clients or suppliers. These practices are prohibited because they can create unfair market conditions, limiting consumer choices and stifling competition.

To determine whether an action constitutes a relative monopolistic practice, the law considers several factors. These include the substitutability of the good or service, distribution costs, consumer access to alternative markets, regulatory restrictions and the dynamics of innovation. The relevant market is defined based on these factors, ensuring that the analysis is comprehensive and considers all aspects of market competition. This approach helps identify whether an economic agent has substantial power in the market, which is crucial for assessing the impact of its actions on competition.

The law also provides criteria for determining substantial market power, which include market share, the ability to set prices or restrict supply, barriers to market entry, and the presence of competing agents. Recent behaviour and access to input sources are also considered. By evaluating these factors, authorities can assess whether an economic agent’s actions are likely to harm competition. This detailed framework ensures that relative monopolistic practices are identified and addressed effectively, promoting a fair and competitive market environment.

In Panama, the Criminal Code outlines several criminal offences aimed at protecting consumers. Those who intentionally withdraw or withhold essential raw materials or products from the market to create shortages or manipulate prices, resulting in harm to consumers, face penalties ranging from four to eight years of imprisonment. Also, fraudulent billing practices, whereby individuals charge consumers higher amounts for products or services measured by automatic devices, are punishable by two to five years in prison. Panama also criminalises false advertising, whereby businesses include misleading information or uncertain benefits relating to their products or services in their offers or advertisements, causing significant harm to consumers.

In administrative and civil procedures, and as per Law 45 of 2007, economic agents involved in absolute or relative monopolistic practices can be fined up to PAB1 million. Up to three times the amount of damages caused by these practices can be added, plus legal costs. These acts are punishable even if they have not been fully executed or did not produce their intended effects. In addition, any acts constituting absolute monopolistic practices are deemed legally invalid.

These stringent penalties aim to deter anti-competitive behaviour and promote a fair and competitive market environment.

The Criminal Code addresses various cybercrimes, computer fraud and the protection of company secrets. Articles 289 and 290 penalise unauthorised access, use, modification or interference with databases, networks or computer systems with imprisonment of two to four years. These penalties are increased if the offences involve public offices, financial institutions or medical entities, or if committed for profit. Penalties are increased if the offences are committed by individuals responsible for or authorised to access the systems; this increase is from one-sixth to one-third of the original penalty.

Regarding trade secrets, the Criminal Code punishes the unauthorised use or appropriation of industrial or commercial secrets for economic gain or to cause harm with four to six years of imprisonment.

Unjustified disclosure of trade secrets is punishable by two to four years of imprisonment.

Theft of economic innovations or secrets is also punished by imposing two to four years of imprisonment, or three to six years if committed by public officials, company employees or professional service providers.

In Panama, the Criminal Code outlines several financial crimes, trade offences and customs violations.

The illicit appropriation, transfer or misuse of financial resources from banking or financial entities is punishable by imprisonment of four to six years, increasing to six to eight years if committed by an employee or official exploiting their position.

Panama punishes financial institution officials who conceal liquidity or insolvency issues by providing false information to supervisory authorities with five to eight years of imprisonment.

Market manipulation and fraudulent trading practices are punishable by four to six years of imprisonment.

Customs violations, such as smuggling and evading duties, are punishable by two to five years of imprisonment, with specific penalties for various related offences. Tax evasion and fraudulent customs declarations are penalised with two to five years of imprisonment, increasing for significant fraud amounts. These provisions aim to maintain financial integrity and protect public interests.

The Criminal Code stipulates that public officials who contribute to customs violations, such as altering customs assessments, concealing infractions or improperly performing verification duties, will face three to six years of imprisonment and disqualification from public office for an equal length of time afterwards. This includes tampering with the official customs information system without proper authorisation.

Article 254 of the Criminal Code addresses the offence of concealment. It penalises individuals who, either personally or through intermediaries, receive, deposit, negotiate, transfer or convert money, securities, assets or other financial resources, knowing they originate from various serious crimes such as international bribery, human trafficking, drug-related offences, terrorism and more. The intent must be to hide, cover up or disguise the illicit origin of these resources or to help evade legal consequences. The punishment for this offence is imprisonment for five to 12 years.

According to the degree of participation, people can be punished based on the help or collaboration they provide, and depending on the level of collaboration, a corresponding sanction will be imposed.

Money laundering is attributed to anyone who personally or through an intermediary receives, deposits, negotiates, transfers or converts money, securities and other financial resources, and who should have reasonably foreseen that they came from illicit activities.

The illicit activities in money laundering are called predicate offences, and these are detailed in the Criminal Code, and described below.

Predicate Offences Described in the Law

The predicate offences for money laundering include crimes against copyright and related rights, crimes against industrial property rights, illegal trafficking of migrants, human trafficking, organ trafficking, environmental crimes, commercial sexual exploitation crimes, crimes against the legal personality of the State, crimes against the legal security of electronic media, aggravated fraud, robbery, financial crimes, kidnapping, extortion, murder for hire or reward, embezzlement, corruption of public officials, unjust enrichment, child pornography and corruption of minors, international theft or trafficking of vehicles or of their parts and components, forgery of documents in general, omission or falsification of the traveller’s customs declaration regarding money, securities, or negotiable documents, counterfeiting of currency and other securities, crimes against the historical heritage of the nation, crimes against collective security, terrorism and financing of terrorism, drug-related crimes, piracy, organised crime, illicit association, gang activity, possession and trafficking of arms and explosives, violent appropriation and removal of illicit material, trafficking and receiving of items from crime, smuggling and customs fraud with the aim of hiding, covering up or disguising the illicit origin of the funds. These acts, or helping someone to evade the legal consequences of such punishable acts, will be sanctioned with a penalty of five to 12 years in prison.

Attribution of Criminal Liability

To attribute guilt, it is necessary to prove that the funds came from one of the so-called predicate offences and that the person who received, deposited or transferred them was aware of their illicit origins. The penalty ranges from five to 12 years in prison.

Laws and Regulations to Prevent Money Laundering

There are various legal provisions and regulations requiring entities and individuals to adopt measures to prevent money laundering. Administratively, Panama has laws and regulations that establish certain guidelines that financial or non-financial entities that collect resources from the population must follow, and if these entities violate these parameters and allow money laundering, they will be sanctioned through fines, disqualification from activities, and even closure of commercial establishments. If it is established that these individuals have a greater contribution to the crime of money laundering, they will be subject to a more severe sanction, such as imprisonment.

If it is established during the investigation process that all the requirements set forth in both the law and the regulations aimed at preventing money laundering were met, and also that there was no money laundering, an acquittal should consequently be obtained.

Compliance and Regulation of Law

The law establishes requirements that must be included in compliance programmes. If an organisation creates regulations to prevent the receipt of money from an illicit source, the actions of someone within the organisation who, for some reason, receives money from an illicit source should not be considered intentional.

Panamanian criminal law provides very well-defined exemptions from guilt; however, most of them would apply to common crimes, for example, legitimate defence after an unjust aggression, lack of provocation and the use of a rational means to repel the imminent damage, but when talking about white-collar crime, everything is reduced to the intentionality of the act. Given that ignorance of the law does not exempt a person from liability, lack of knowledge that an act was illicit could hardly be used as an exception.

Article 220 of the Criminal Code provides rules on sentencing agreements, which are divided into two categories, as follows.

Collaboration Agreements

Collaboration agreements are designed so that the Prosecutor can dispense with a prosecution in a total or partial manner depending on the information provided by the collaborator, sometimes even negotiating the provision of information in exchange for the imposition of a lesser sentence.

Penalty Agreements

On the other hand, a penalty agreement involves the acceptance of criminal responsibility, the penalty for which cannot be less than a third of the penalty that would otherwise be imposed for the crime under investigation.

Panama’s criminal laws provide protections as incentives for whistle-blowers. These protections include the possibility of not appearing in the proceeding and having their identity safeguarded by the Prosecutor. However, it is important to note that during the trial, the defence may have the right to know the identity of the protected witness. This balance aims to encourage the reporting of wrongdoing while ensuring a fair trial process.

In the realm of antitrust law, within the civil and administrative spheres, whistle-blower protections and benefits are granted exclusively to the first individual who reports the wrongdoing. Subsequent witnesses who provide information leading to evidence of monopolistic practices or actions that harm economic free competition and free market entry in the production, processing, distribution, supply or marketing of goods or services do not receive the same benefits. This policy aims to incentivise early reporting while maintaining a fair and competitive market environment.

Whistle-blowing can significantly impact trade secrets and confidential information, potentially causing commercial disadvantages to a corporation. When an employee discloses information about illegal or unethical practices, they might inadvertently reveal sensitive data that competitors could exploit. This could include proprietary technologies, business strategies or customer information. However, there is a delicate balance to maintain. Legal frameworks often provide protections for whistle-blowers to encourage the reporting of wrongdoing while also safeguarding certain types of confidential information. For instance, whistle-blower laws typically include provisions to protect trade secrets and other sensitive information from unnecessary disclosure. The expectation is that only information directly relevant to the illegal or unethical activity should be disclosed, and measures should be taken to minimise any potential harm to the corporation’s legitimate business interests.

The rule that protects a protected witness is set out in Article 340 of the Criminal Code, which states that the Prosecutor’s Office, within the development of the investigation, at the time of presenting the accusation and announcing its elements of evidence, may accompany this with the identification data of witnesses and experts in a sealed envelope. This measure loses force when the identity of the witness may be known to the defence in the intermediate phase of the criminal process, which leaves them exposed to any danger before the oral trial. The protected witness ceases to be a protected witness in the intermediate phase, since they are revealed to the defence, a situation that could possibly jeopardise the amount of evidence to be debated in oral trial. Everything will depend on the way the defence acts and its procedural loyalty to the process.