Financial institutions tasked to frustrate efforts of money launderers

Source: Globalnewsreel.com

The Director-General of the Inter-governmental Action Group Against Money Laundering in West Africa (GIABA), Dr. Abdullahi Shehu, on Wednesday charged financial institutions to map out strategies aimed at frustrating the efforts of miscreants who misuse the financial system to accrue illegal wealth.

He explained that “when illicit funds are commingled with legitimate money, the financial institutions become highly susceptible to the vagaries of illegal activities.”

Thus, there was the need for these institutions to always apply careful in-house controls, which could guarantee their safety and soundness.

Several financial institutions worldwide have fallen victims to diverse forms of money laundering activities, costing them billions of dollars annually.

Dr. Buno Nduka, Head of Programmes Division for GIABA, delivered the speech on behalf of the Director-General at the opening of a two-day regional workshop for commercial bank chief executives and chief compliance officers from the sub-region in Accra.

The workshop, which ends today, has been designed to create regional awareness among the participants to meet the modified international standards of combating money laundering and the financing of terrorism and comply accordingly.

Other objectives include soliciting support of top management of banks to promote the implementation of effective anti-money laundering and combating the financing of terrorism (AML/CFT) measures in the region, acquaint top management on issues of good corporate governance and promote networking among operators in the region in order to share information.

Moreover, recommendations in the revised international AML/CFT standards, according to Dr. Shehu, positioned the financial institutions to implement effective and efficient risk based approach in product and customer delivery, identify and verify customers using reliable source document as well as obtaining information on the purpose and intended nature of business relationship among others.

GIABA was established in 2000 by the authority of Heads of States and government of the Economic Community of West Africa States (ECOWAS) to ensure the adoption of standards against money laundering and the financing of terrorism in accordance with acceptable international standards and practices including the Financial Action Task Force 40+9 (FATF) recommendations.

Its other mandates are to facilitate the adoption and implementation by member states, of measures against ML and FT, considering specific regional peculiarities and conditions, organize self-evaluations and mutual evaluations to determine the efficacy of measures adopted and so on.

On his part, the Minister of Finance and Economic Planning in Ghana, Dr. Kwabena Duffour acknowledged that the activities of money launderers hampered sustainable development of the economy, which consequently led to “conflicts and instability in our body politics.”

To him, this instability could lead to greater risks and an increment in the cost of doing business in the country.

“It is therefore, in our collective interest to combat this canker to protect our economies from abuse,” Dr. Duffour stated.

He however, outlined the delay in the criminalization of predicate offences such as illicit trafficking in explosives, firearms and ammunition and limited expertise among law enforcement authorities to conduct financial investigations as some of the setbacks militating against the campaign.

Also, Governor of the Bank of Ghana, Dr. Kwasi Amissah-Arthur indicated that the “downgrading of Ghana by FATF in February 2012, has energized the country to re-double its efforts to build a robust AML/CFT regime.”

Adding that, Ghana had resolved to remove the remaining obstacles while ensuring that the country was de-listed from the FATF black list in earnest.

Dr. Amissah-Arthur further said the Anti-terrorism Amendment Act 2012 (Act 842), which was recently enacted, empowered the Attorney-General to issue instructions by Executive Instrument.

By this, banks and non-banking institutions in the country were now required to submit suspicious transaction reports (STRs) involving terrorism financing.