Sanctioning Haitian Banks and Companies (SOGENER Case): A Not-So-Common Practice in Haiti
Dr. Eddy N. LABOSSIERE In recent Haitian banking history, we have noted the case of two (2) banks that were sanctioned in 2020: Unibank and Capital Bank.
By La Rédaction · Port-au-Prince
· 5 min read · Updated 24 April 2026
Translated from French — AI-assisted and reviewed by the editorial team. The French version is authoritative. Read the original · About our translation policy
Dr. Eddy N. LABOSSIERE
In recent Haitian banking history, we have noted the case of two (2) banks that were sanctioned in 2020: Unibank and Capital Bank.
Regarding anonymous companies over the past five (5) years, there have been no cases of sanctions. This is why in this study we will focus primarily on the case of our commercial banks, and a reflection on the bankruptcy of SOGENER will be made in conclusion.
Banks are sanctioned by national or international regulatory authorities when they fail to meet their legal and regulatory obligations. These sanctions aim to punish infractions, deter further breaches, and maintain the stability and security of the financial system.
I- Sanctioning and Support Authorities.
Several institutions or organizations are authorized to impose sanctions on banking establishments:
● At the national level (Haiti): The prudential supervisory authority, the BRH, through its supervision department, has disciplinary sanctioning power against banks under its control. The financial markets authority (AMF) sanctions market abuses; in Haiti, with the absence of a Haitian Stock Exchange, this authority does not exist in practice.
● At the Caribbean level: The Caribbean Regional Technical Assistance Centre (CARTAC) is one of the ten (10) Regional Technical Assistance Centers (RTACs) of the IMF. CARTAC assists in complying with and strengthening standards and procedures and implementing sound macroeconomic policies.
● Another international structure called the FATF (Financial Action Task Force) sanctions countries for non-compliance with principles related to Anti-Money Laundering and Combating the Financing of Terrorism.
● At the international level: Governments (such as the United States via OFAC) and international organizations (such as the UN, OAS) impose economic and financial sanctions that apply to banks operating globally.
II- Main Reasons for Sanctions.
Banks are exposed to sanctions for various failures, including:
● Non-compliance with regulations: Failure to comply with prudential rules or general regulatory requirements.
● Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT): Failure to exercise due diligence, omitting to report suspicious situations, or not verifying customer identity (KYC).
● Violation of international/economic sanctions: Conducting transactions with individuals, entities, or countries subject to sanctions or embargoes (e.g., Russia, Iran, North Korea, etc.)
● Consumer protection: Failures in information and advisory obligations towards clients.
III- Types of Sanctions and Consequences
Sanctions can be of different types.
● Pecuniary sanctions: Very significant fines or penalties, sometimes several million or billion gourdes, can be imposed for serious offenses.
● Disciplinary measures: Warnings, reprimands, or even withdrawal of license in extreme cases.
● Activity restrictions: Prohibition of certain operations or asset freezes.
These sanctions have significant consequences for banks, ranging from financial losses and reputational damage to severe operational restrictions, and can also impact their clients through payment suspensions or difficulties in accessing financial services.
CONCLUSION
In Haiti, there have been a few cases of bank sanctions. Let's mention two (2).
In August 2020, the BRH, the prudential supervisory authority, sanctioned two (2) banks:
Unibank and Capital Bank. Very significant fines were imposed: Unibank had to pay a penalty of 865.4 million gourdes and Capital Bank 4 million gourdes. These two banks were sanctioned primarily for violating norms and procedures regarding foreign exchange operations.
Since 2020, no other bank has been sanctioned. Can we believe that the BRH, through its supervision department, has done a good job by forcing commercial banks to comply with prudential standards and BRH circulars? The question remains open. We can mention two other situations. About three (3) years ago, in August 2022, the FATF (Financial Action Task Force) issued threats against Haiti, specifically targeting the banking sector, namely to cut off Haitian banks from all contact with foreign banks by disconnecting the SWIFT code, for example.
To avoid this very heavy sanction, Haitian banks agreed to apply the procedure concerning anti-money laundering and combating the financing of terrorism.
It is important to know that the FATF studies how money is laundered and terrorism is financed, promotes global standards to mitigate risks, and assesses whether countries are taking effective measures to combat money laundering and the financing of terrorism. Today, we are following another case, that of Sogebank and Western Union (WU). It is difficult to obtain information, as Haitian banks do not operate with full transparency, but we observe that Sogebank's WU service is no longer functioning. Did this bank show failures regarding the application of procedures on the origin of funds? This is another open question. In Haiti, there is a legal vacuum regarding the regulation of the financial market and the economic sector specifically. For example, we do not have a "competition law," nor do we have a law on "financial market authorities" or a market watchdog. This absence of a complete and appropriate legal environment is sorely lacking, and the main victims are and will be market participants on both the supply and demand sides. We have the case of SOGENER, which closed its doors without a word to its Haitian creditors holding SOGENER bonds totaling ten million US dollars (10,000,000 USD). The existence of a regulatory authority in the economic field would have helped these poor middle-class investors who invested their meager assets or savings by purchasing SOGENER bonds to recover their investment. SOGENER's misfortune causes almost irreparable damage to the development of the Haitian financial market, and thus to Haiti's economic development. Consequently, a shock or crisis of confidence sets in, and issuers of bonds or securities will have great difficulty finding buyers in the future.
It is high time to have the appropriate legal framework to prevent the repetition of cases like SOGENER's. We all agree that without a complete and well-regulated financial market, it will be impossible for Haiti to develop because our entrepreneurs or investors will not be able to find long-term financing for their long-term investment needs.
Let us remember that financing or bank credit for businesses is often short-term for working capital formation or cash flow needs.
In August 2020, the BRH, the prudential supervisory authority, sanctioned two (2) banks:
Unibank and Capital Bank. Very significant fines were imposed: Unibank had to pay a penalty of 865.4 million gourdes and Capital Bank 4 million gourdes. These two banks were sanctioned primarily for violating norms and procedures regarding foreign exchange operations.
Since 2020, no other bank has been sanctioned. Can we believe that the BRH, through its supervision department, has done a good job by forcing commercial banks to comply with prudential standards and BRH circulars? The question remains open. We can mention two other situations. About three (3) years ago, in August 2022, the FATF (Financial Action Task Force) issued threats against Haiti, specifically targeting the banking sector, namely to cut off Haitian banks from all contact with foreign banks by disconnecting the SWIFT code, for example.
To avoid this very heavy sanction, Haitian banks agreed to apply the procedure concerning anti-money laundering and combating the financing of terrorism.
It is important to know that the FATF studies how money is laundered and terrorism is financed, promotes global standards to mitigate risks, and assesses whether countries are taking effective measures to combat money laundering and the financing of terrorism. Today, we are following another case, that of Sogebank and Western Union (WU). It is difficult to obtain information, as Haitian banks do not operate with full transparency, but we observe that Sogebank's WU service is no longer functioning. Did this bank show failures regarding the application of procedures on the origin of funds? This is another open question. In Haiti, there is a legal vacuum regarding the regulation of the financial market and the economic sector specifically. For example, we do not have a "competition law," nor do we have a law on "financial market authorities" or a market watchdog. This absence of a complete and appropriate legal environment is sorely lacking, and the main victims are and will be market participants on both the supply and demand sides. We have the case of SOGENER, which closed its doors without a word to its Haitian creditors holding SOGENER bonds totaling ten million US dollars (10,000,000 USD). The existence of a regulatory authority in the economic field would have helped these poor middle-class investors who invested their meager assets or savings by purchasing SOGENER bonds to recover their investment. SOGENER's misfortune causes almost irreparable damage to the development of the Haitian financial market, and thus to Haiti's economic development. Consequently, a shock or crisis of confidence sets in, and issuers of bonds or securities will have great difficulty finding buyers in the future.
It is high time to have the appropriate legal framework to prevent the repetition of cases like SOGENER's. We all agree that without a complete and well-regulated financial market, it will be impossible for Haiti to develop because our entrepreneurs or investors will not be able to find long-term financing for their long-term investment needs.
Let us remember that financing or bank credit for businesses is often short-term for working capital formation or cash flow needs.
