CAMEROON: COBAC Sanctions Nine Banks for Non-Compliance with Anti-Money Laundering Regulations
===========================================================
The Commission Bancaire de l’Afrique Centrale (COBAC) has imposed sanctions on nine banks and 12 financial institutions in Cameroon for non-compliance with anti-money laundering regulations. The regulator identified various compliance violations during on-site inspections, including failures to report suspicious transactions, holding of unjustified external assets, and failure to obtain prior authorization for foreign direct investment.
Sanctions Imposed
The COBAC imposed fines totaling over 3 billion FCFA (approximately $5.7 million USD) on the affected banks and financial institutions. Additionally, senior officials from these institutions have been suspended from their duties. The institutions have been given a deadline to rectify the identified compliance issues and demonstrate improved adherence to anti-money laundering regulations.
Causes of Non-Compliance
Experts attribute the widespread non-compliance in Cameroon’s banking sector to lack of professional inadequacy within the compliance function, inadequate support from top management, and insufficient resources. The COBAC has emphasized the importance of taking compliance seriously and investing in compliance functions.
COBAC’s Efforts to Strengthen Anti-Money Laundering Regulations
The COBAC is committed to strengthening anti-money laundering regulations in Cameroon. To achieve this, the regulator has:
- Issued guidelines for banks and financial institutions on how to implement effective compliance measures
- Conducted on-site inspections to identify compliance violations
- Imposed sanctions on non-compliant institutions
New Regulatory Body
The Cameroonian government plans to establish a new regulatory body to oversee the banking sector. This move is aimed at strengthening oversight and improving compliance in the industry.
Impact of COBAC’s Sanctions
The COBAC’s sanctions are likely to send a strong message to banks and financial institutions in Cameroon, encouraging them to take compliance more seriously going forward. The industry may also see increased investment in compliance training and resources.
Conclusion
The fight against money laundering and terrorism financing is a complex one, but it is essential for ensuring the stability of the banking sector and preventing illicit activities. With the COBAC’s sanctions in place, banks and financial institutions are likely to take compliance more seriously, and the regulator will continue to crack down on non-compliance to ensure the integrity of the industry.