Botswana Completes National Anti-Money Laundering and Counter Financing of Terrorism Risk Assessment
GABORONE - Botswana has completed a National Anti-Money Laundering (AML) and Counter Financing of Terrorism (CFT) Risk Assessment, becoming the eleventh African country to do so. The three-day workshops to adopt the National AML/CFT Risk Assessment Report and Action Plan were supported by the World Bank.
Background
- In 2012, the Financial Action Task Force (FATF) adopted an international obligation for countries to undertake a National AML/CFT Risk Assessment.
- Botswana requested assistance from the World Bank to begin the assessment in 2014.
- The World Bank’s National Risk Assessment (NRA) Tool was instrumental in guiding countries in commencing such an assessment.
- Over 40 countries have utilized the NRA Tool to complete their National Risk Assessment.
- Botswana is among the 30+ countries requesting technical assistance and the World Bank NRA Tool to initiate their assessments.
Workshop Highlights
Elene Imnadze, World Bank Botswana Country Representative, expressed her satisfaction with Botswana’s efforts, stating that the World Bank’s NRA Tool helped provide a clearer understanding of assessing actual money laundering and terrorist financing risks.
“Botswana’s efforts to complete its National AML/CFT Risk Assessment demonstrate a strong commitment to adhering to international obligations and mitigating threats and vulnerabilities in their financial system.”
Elene Imnadze, World Bank Botswana Country Representative
More than 50 officials from approximately 20 collaborating ministries and agencies participated in the assessment process. The risks were evaluated based on ’threats’ and ‘vulnerabilities.’
Threats
- Existing circumstances and systems that could not be eliminated but required mitigation, such as illegal activities originating abroad and within Botswana’s financial system.
Vulnerabilities
- The effectiveness of internal mitigation systems, including customs and border control systems and financial sector controls.
Identified Risks
Money laundering risks identified during the workshop included:
- Wildlife poaching
- Weak controls in the diamond sector
- Auto theft
- Financial crimes like tax evasion and corruption
Systemic weaknesses in AML/CFT controls were found in Botswana’s legal framework and implementation effectiveness.
Importance of AML/CFT Obligations
The completion of Botswana’s National AML/CFT Risk Assessment aligns with important international AML/CFT obligations, a process being undertaken by many countries worldwide. These obligations aim to fight money laundering, terrorist financing, and related criminal activities by identifying, assessing, and addressing the countries’ risks.
- Based on various international treaties and conventions such as the 40 Recommendations of the Financial Action Task Force Against Money Laundering/Terrorist Financing (FATF).
Next Steps
Elaina Gonsalves, Deputy Secretary for Economic and Finance Policy in the Ministry of Finance and Economic Development, acknowledged the World Bank’s support and the commitment of the NRA working groups. She emphasized the need to strengthen Botswana’s legal framework, which serves as the first line of defense against money laundering and terrorist financing.
The identified risks and threats will inform officials in implementing appropriate control measures to combat money laundering, terrorist financing, and related criminal activities, such as corruption, in accordance with international AML/CFT obligations. This system ultimately aims to reduce illicit financing flows and contribute to stronger economic development, shared prosperity, and poverty reduction.