Financial Crime World

Democratic Republic of Congo Faces Increased Scrutiny Over Anti-Money Laundering Efforts

The Democratic Republic of Congo (DRC) is facing increased scrutiny from the international community over its efforts to combat money laundering, terrorist financing, and proliferation financing. In response, the country has been placed under increased monitoring by the Financial Action Task Force (FATF) and the European Union (EU).

Increased Monitoring by FATF

As of October 2022, the DRC was formally designated as a Jurisdiction under Increased Monitoring by FATF, following concerns over its failure to adequately address strategic deficiencies in its anti-money laundering regime. This move is aimed at addressing these shortcomings and strengthening the country’s national anti-money laundering and counter-terrorist financing framework.

Concerns Over Strategic Deficiencies

The DRC has been criticized for its lack of progress in addressing strategic deficiencies in its anti-money laundering regime, including:

  • Insufficient regulation of non-bank financial institutions
  • Inadequate supervision of banks and other financial institutions
  • Lack of effective sanctions against money launderers and terrorist financiers
  • Limited cooperation with international authorities

EU’s High-Risk List

In March 2023, the EU added the DRC to its list of high-risk third countries, signaling a heightened level of scrutiny. This move is expected to lead to increased collaboration between the DRC and international authorities, including FATF and technical assistance providers.

Collaboration and Support

The increased monitoring by FATF and the EU is expected to lead to increased collaboration between the DRC and international authorities aimed at rectifying the country’s strategic deficiencies and strengthening its national anti-money laundering and counter-terrorist financing framework. This will include:

  • Technical assistance from FATF and other international organizations
  • Support for capacity building in areas such as regulation, supervision, and enforcement
  • Increased cooperation with international authorities to combat money laundering and terrorist financing

EU Global Facility Scoping Mission

In August 2022, the EU Global Facility on Anti-Money Laundering and Combating the Financing of Terrorism conducted a scoping mission to the DRC. The mission assessed the country’s request for support in enhancing its AML/CFT measures and improving its general framework. The report highlighted several areas where the DRC needs improvement, including:

  • Strengthening its regulatory framework
  • Improving supervision and enforcement
  • Enhancing international cooperation

By addressing these strategic deficiencies and strengthening its anti-money laundering and counter-terrorist financing regime, the DRC can improve its reputation as a responsible financial jurisdiction and reduce the risk of being used for illicit activities.