Burkina Faso Struggles to Implement Anti-Money Laundering Reforms
International watchdogs have flagged several areas where Burkina Faso falls short on implementing technical requirements to combat money laundering and terrorist financing.
Gaps in Implementing FATF Recommendations
In its latest assessment, Burkina Faso scored poorly on several recommendations from the Financial Action Task Force (FATF). The country was found to be “partially compliant” with 15 out of 40 assessed areas. Key shortcomings include:
- National Cooperation and Coordination: Inadequate national cooperation and coordination hinder effective implementation of AML/CFT measures.
- Laws and Regulations: Weak laws and regulations governing money laundering offenses, confiscation of proceeds, and terrorist financing.
- Supervision of Financial Institutions: Limited supervision of financial institutions and non-profit organizations leaves them vulnerable to illicit activities.
- Customer Due Diligence: Insufficient customer due diligence practices make it difficult to identify and report suspicious transactions.
Concerns Over Correspondent Banking
Burkina Faso also failed to meet the FATF’s expectations on correspondent banking, which is critical for international trade and economic development. The country’s lack of effective regulation and supervision of correspondent banking relationships increases the risk of money laundering and terrorist financing through these channels.
International Cooperation and Assistance Needed
To address these gaps, Burkina Faso needs to strengthen its cooperation with international partners and receive assistance from organizations such as the International Monetary Fund (IMF) and the World Bank. This will require a coordinated effort to:
- Build Capacity: Enhance regulatory frameworks and improve law enforcement capabilities.
- Regulatory Frameworks: Strengthen laws and regulations governing money laundering offenses, confiscation of proceeds, and terrorist financing.
- International Partnerships: Foster cooperation with international partners to combat money laundering and terrorist financing.
The FATF has called on Burkina Faso to take concrete steps to address these shortcomings and implement effective AML/CFT measures. Failure to do so may lead to further scrutiny and potential sanctions from international bodies.