Liberia Tighten Screws on Money Laundering, Terrorist Financing

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FIU director-general Alex Cuffy

Liberia’s Financial Intelligence Unit (FIU) has begun a money laundering and terrorist financing (ML&TF) national risk assessment (NRA) workshop, which commenced April 17, 2018, at the Central Bank of Liberia (CBL).

The first phase of the three-day event, which will roll over in a year, is to identify, assess and understand ML&TF risks; apply risk-based approach (RBA) to prevent or mitigate ML&TF; apply resources commensurate with the risks, efficient allocation of resources across anti-money laundering and countering the financing of terrorism (AML/CFT).

The NRA is a process where a country identifies the risk to its AML/CFT regime and develops a framework to prevent it.

Speaking at the opening ceremonies, FIU director-general Alex Cuffy said the banking, insurance and security sectors will also be assessed to gauge their readiness to combat AML/CFT.

“This process will go on for, plus or minus 12 months. This process starts from the worldwide authority, Financial Action Task Force (FATF) in line with recommendation one, which is the authority for money laundering and countering the financing of terrorism.

“Of course, that institution works through a regional body. In our region, we have the Inter-Governmental Action Group against Money Laundering in West Africa (GIABA), which establishes a schedule for its members, including two other countries. Liberia has a period from October 2017 to March 2019 to complete its NRA,” said Cuffy, who was praised for leading the process.

GIABA Research and Planning Director Muazu Umaru said the NRA is a compliance issue, which Liberia must take seriously, in order to avoid being poorly rated.

When you are poorly rated, Umaru said, the international community will take action against your financial sector.

“And that only means that you are likely to have less investor. You are likely to have people with growing correspondence services with your banks. So what you are going to do have a fundamental implication for your country. Indeed, it is very, very, very important work.

“You are lucky to be selected for this pioneering activity, which will continue in due course. I will urge you to give your best for your country so that your country will be able to meet the requirements for compliance internationally. We are committed to supporting each country with the specific amount of money that we hope will be used judiciously,” said Umaru, who has been working for GIABA since 2009.

Samuel Chukwuka Ijeh, Chief Financial Economist at African Development Bank-wide Taskforce on prevention of money laundering and illicit financial flows (IFFs), said one of the bank’s goals is to support the economic and social development of its members.

Ijeh added that the bank sees IFFs, money laundering and terrorist financing (ML/TF) as negative factors on economic development.

He said the bank will support NRA on ML/TF in keeping with its 2007 strategy on AML/CFT, which was expanded to incorporate IFFs, and approved last year.

“We also emphasize the importance of collaboration among the banks and sister institutions like the World Bank, GIABA and United Nations Office on Drugs and Crime (UNODC). We have collaborated with The Gambia NRA. We did participate in the final workshop for Sierra Leone. And this is the third one we are participating in,” said Ijeh.

He disclosed that the AfDB is currently working on a project with FIUs, having visited Senegal, Ghana, The Gambia, and Nigeria, to assess the NRA and capacity building needs of members of GIABA.

“We’ll raise the necessary resources to support those countries that are yet to do their NRAs. And those that have done NRA, funding will be made available to see how we can support the outcome of the NRA, the action plans, and development of their national strategies,” said Ijeh.

According to World Bank (WB) Senior Financial Sector Specialist Cari Votava, 14 African countries, including Ghana, Nigeria, Sierra Leone, Senegal and Cape Verde, have used the bank’s NRA Tool to complete their NRAs.

Votava also disclosed that an NRA is taking place in 11 African countries, including Niger, Benin, Burkina Faso, Gambia, and Liberia.

“What I would like you to do is to keep in mind the main goal of this. It is aimed at helping you in your individual sectors and your country identifies and prioritizes the most serious, less serious and least serious risks of money laundering,” she told the participants from financial and security institutions like the CBL, FIU, Ministry of Justice and GSM Companies.

The NRA will receive technical and financial assistance from the Liberian government, GIABA, AfDB, World Bank and UNODC.

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