Democratic Republic of Congo Faces International Scrutiny Over Anti-Terrorist Financing Regulations
The Democratic Republic of Congo (DRC) has been placed under increased monitoring by the Financial Action Task Force (FATF) in October 2022, following a similar move by the European Union (EU) in March this year. This designation means that Kinshasa will be working closely with international authorities to address significant weaknesses in its anti-money laundering and counter-terrorist financing regime.
FATF Designation
The FATF’s decision is based on the DRC’s failure to meet certain standards set by the organization, including a lack of effective measures to combat money laundering and terrorist financing. The EU Global Facility on Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) conducted a scoping mission to the DRC in August 2022 to assess the country’s request for support to strengthen its AML/CFT measures and overall framework.
Identified Shortcomings
The mission identified several strategic deficiencies in the national anti-money laundering and counter-terrorist financing framework, including:
- Inadequate laws and regulations
- Insufficient resources and funding
- Limited public awareness of money laundering and terrorist financing risks
- Ineffective oversight and supervision of financial institutions
- Lack of international cooperation
Remedial Measures
To address these shortcomings, the EU Global Facility team has been working with local authorities and relevant stakeholders to rectify the identified deficiencies. The team has delivered training and activities aimed at helping Kinshasa improve its compliance with international standards as set out in the Fourth and Fifth Anti-Money Laundering Directives.
Enhancing Financial Transparency
The move is seen as a crucial step towards enhancing financial transparency and reducing the risk of terrorist financing and money laundering in the region. By strengthening its anti-money laundering and counter-terrorist financing regime, the DRC can improve its reputation and reduce the risk of being used as a hub for illicit financial activities.
Conclusion
The FATF designation and EU Global Facility support are important milestones in the DRC’s efforts to strengthen its anti-money laundering and counter-terrorist financing framework. The country must continue to work closely with international authorities to address its shortcomings and improve its compliance with international standards.