SADC putting the brakes on money laundering, terror financing


The Southern African Development Community (SADC) Secretariat is stepping up the region’s resolve to fight money laundering, terrorism financing and proliferation finance.

There is a common dislike to money laundering, terrorism finance and proliferation finance in SADC and member states committed themselves, through the Eastern and Southern Africa Anti-Money Laundering Group of countries (ESAAMLG), to take effective measures against the vices, a SADC statement reads.

Against this background SADC convened a validation workshop in Johannesburg, South Africa, earlier this month (March) to discuss facilitating convergence of the anti-money laundering and combatting financing of terrorism policies, laws and regulatory practices in member states with the requirements of the Financial Action Task Force (FATF).  Participants deliberated on ways to support effective and action against money laundering and the financing of terrorism it 16 member states.

A specific objective of the workshop, backed by the European Union (EU) supported Support to Investment and Business Environment Enhancement Programme (SIBE), was to assess implementation of FATF recommendations to ensure effective and proportionate measures against money laundering. It assessed the capacities of national authorities to combat money laundering and terrorist financing and proliferation financial structures and a capacity building programme for national authorities.

The workshop further assessed whether the level of risk to implementation of FATF recommendations to ensure effective measures against money laundering, terrorist financing and proliferation financing in the SADC region are equal with money laundering and terrorism financing risks.

In welcoming remarks workshop chair John Muamba, emphasised the need to deliberate on and find measures to ensure there are effective ways to combat terrorism financing, money laundering and proliferation financing in the region.

The SADC region, he said, must not be seen as weak and vulnerable to money laundering, financing terrorism and proliferation finance.

The workshop was anchored on Annex 12 of the SADC Protocol on Finance and Investment.  The Protocol foresees compliance of all SADC member states with the FATF recommendations in line with set guidelines.

FATF leads global action to tackle money laundering, terrorism and proliferation financing. Its purpose is to establish international standards and to develop and promote policies, both at national and international levels, to combat money laundering and the financing of terrorism. FATF recommendations set out a comprehensive and consistent framework of measures which countries should implement in order to combat money laundering and terrorist financing as well as the enhancing of proliferation of weapons of mass destruction. FATF Recommendation 7 requires countries to implement targeted financial sanctions to comply with the United Nations Security Council Resolutions (UNSCRs) relating to the prevention, suppression and disruption of proliferation of weapons of mass destructions (WMD) and its financing.

Money laundering is illegally concealing the origin of money, obtained from illicit activities such as drug trafficking, corruption, embezzlement or gambling, by converting it into a legitimate source. Terrorist financing is raising money involving solicitation, collection or provision of funds, with the intention it may be used to support terrorist acts, terrorists or terrorist organisations. Proliferation financing is defined by the FATF as the provision of funds or financial services used for manufacture, acquisition, possession, development, export, trans-shipment, brokering, transport, transfer, stockpiling or use of nuclear, chemical or biological weapons and their means of delivery.