Regional firm Arias & Muñoz, based in San Salvador, has snagged a new partner for its Panama office. Yuri Moreno, who advises banks and insurance companies and whose practice areas include litigation and arbitration, joined the firm on February 1, making him the fourth partner in the firm’s Panama office. As part of his hire, Arias & Muñoz incorporated Moreno’s former firm, Moreno Vásquez & Asociados. The firm included Moreno, an associate, a paralegal and an intern.
“We bought his operation of his firm because he’s providing services, that have to do with collections, arbitrations and litigation, to banking and insurance companies that we are not providing [services to] right now,” explained managing partner of Panama, Gisela Porras. Porras became familiar with Moreno’s work because both Moreno and Porras worked at Panama-city based Patton Moreno & Asvat and Moreno replaced Porras at the firm when she did her masters in London from 1988-1989.
Arias & Muñoz partner Siaska Lorenzo, based in Panama, also came to know Moreno, as the two both obtained law degrees from Santa Maria La Antigua University around the same time (Moreno graduated in 1988 and Lorenzo in 1987). It was Lorenzo who initially contacted Moreno in December 2015 about the idea of merging the firms. After meeting with the heads of Arias & Muñoz in El Salvador, Moreno decided to move ahead with the deal, feeling that Arias & Muñoz was a “merit-based law firm [and] not a family business.”
Moreno’s hire comes at a time of reform in Panama’s banking sector spurred by allegations of money laundering and funding of terrorism. As of February 19, Panama is off the Financial Action Task Force’s grey-list thanks to reforms put into practice to fight money laundering. For example, in April 2015, Panama passed a law which required owners of bearer shares to register them with an authorized custodian by December 31, 2015. (A previous law allowed until August 2018.) Though Moreno expressed his general support for such reforms, he emphasized to IFLR1000 the difficulties that this may create for smaller law firms.
In Moreno’s view, this reform makes it more difficult for smaller law firms to work with owners of bearer shares. “Before this law, any solo practitioner or small law firm could incorporate a Panamanian company with bearer shares. Right now, due to this requirement, it is very expensive if not practically impossible for a sole practitioner or small law firm to engage in this area of law. They simply don’t have the budget required to hire the staff (secretaries, paralegals, compliance officers, etc.) that is needed to act as authorized custodians.”
Moreno also commented on an aspect of the law requiring financial companies and professionals to report transactions that they think involve illicit activity or money laundering.“That has also put an additional economic burden on said financial companies, banks, real estate brokers, law firms and the like because now you have to have an officer within your operation whose sole purpose is to verify the precedence of funds and to do the due diligence on clients and so forth,” Moreno commented.
Moreno emphasized that he did generally agree with the restrictions. “Our world has become such a complicated place that these sort of safeguards are necessary. The problem is that these [requirements] should take into consideration the economic burden that having or setting those restrictions will [put] on the economies of the different countries,” he said.