Money Laundering Scandal Rocks Central African Republic: AML Report Exposes Cracks in the System
Date: August 28, 2006
A new report has highlighted the weaknesses of the Central African Republic (CAR) in the fight against money laundering and terrorism financing. The Central African Economic and Monetary Community (CEMAC) Anti-Money Laundering and Combating the Financing of Terrorism (AML-CFT) framework was assessed for conformity with international standards in the report. The evaluation covered the institutional framework, laws, regulations, guidelines, and other requirements, as well as the capacity, implementation, and effectiveness of these systems.
Significant Non-Compliance Issues
According to the report, the CAR’s current AML-CFT framework exhibits significant non-compliance issues, particularly in the areas of legislation, regulatory systems, and enforcement. The assessment revealed the following:
- Legislation: The CAR lacks sufficient legislation to adequately address money laundering and terrorism financing. The existing laws have limited practical application.
- Regulatory and Supervisory Frameworks: Effective regulatory and supervisory frameworks for Financial Institutions (FIs) and Designated Non-Financial Businesses and Professions (DNFBPs) are absent. These frameworks are essential for preventing money laundering and terrorism financing activities.
- Investigative and Enforcement Capabilities: There is a need for further development of investigative and enforcement capabilities. International cooperation also needs to be enhanced.
Serious Ramifications
These vulnerabilities can have serious ramifications for the CAR and potentially the international community. The report recommends immediate actions to address these concerns, including:
- Legislation: The development and passage of comprehensive AML-CFT legislation.
- Regulatory and Supervisory Frameworks: The strengthening of regulatory and supervisory frameworks.
- Investigative and Enforcement Capabilities: The enhancement of investigative and enforcement capabilities.
Report Details
The 21-page report, available in both English (ISBN/ISSN: 9781451806557/1934-7685, Stock No: 1CAEEA2006004) and French, is part of the series on Anti-money laundering and combating the financing of terrorism, crime, legal support in revenue administration, money laundering, revenue administration, and terrorism financing.