Evaluating Anti-Money Laundering and Combating Terrorism Financing Systems in Central African Republic
The Central African Republic (CAR) has been facing challenges in preventing and combating money laundering (ML) and terrorist financing (TF). A recent report highlights various shortcomings in the country’s efforts to implement effective anti-money laundering (AML) and combating the financing of terrorism (CFT) systems.
Key Challenges and Shortcomings
The report identifies several key areas where improvement is needed:
- Limited Understanding of ML/TF Risks: Many designated non-financial businesses and professions (DNFBPs) in CAR lack a clear understanding of ML/TF risks, making it difficult for them to comply with AML/CFT regulations.
- Insufficient Implementation of CEMAC Regulation: The report notes that many DNFBPs are unaware of the provisions of the CEMAC Regulation and their AML/CFT duties.
- Crypto-Currency Sector Not Adequately Regulated: The introduction of crypto-currencies in CAR has increased ML/TF risks, but there is a lack of specific implementing measures to regulate this sector.
- Weak Control Functions: Shortcomings in the control and supervision system for financial institutions and DNFBPs in CAR make it difficult to prevent the exploitation of these entities for AML/CFT purposes.
- Inadequate Transparency Mechanisms: There are limitations in the mechanisms set up to ensure the transparency of legal entities and arrangements in CAR, which makes it challenging to prevent their misuse for ML/TF purposes.
- Limited International Cooperation: The report notes that CAR has not requested or granted international cooperation in matters of mutual legal assistance and extradition in the field of AML/CFT.
Improving AML/CFT Systems in CAR
The report emphasizes the need for improvement in various areas, including:
- Enhancing understanding of ML/TF risks among DNFBPs
- Improving implementation of CEMAC Regulation
- Regulating crypto-currency sector
- Strengthening control functions and supervision system
- Establishing effective transparency mechanisms
- Promoting international cooperation in AML/CFT matters