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Ethiopia’s Anti-Money Laundering and Combating the Financing of Terrorism Efforts Under Scrutiny

Addis Ababa, Ethiopia - Recent Report Raises Concerns

The Financial Action Task Force (FATF) has released a report expressing concerns over Ethiopia’s progress in implementing anti-money laundering (AML) and combating the financing of terrorism (CFT) measures.

Lack of Progress

While Ethiopia had made some progress in addressing deficiencies identified in its 2015 Mutual Evaluation Report (MER), it still has a long way to go. Specifically, the country was found to be lacking guidelines for detecting and reporting suspicious transactions by designated non-financial businesses and professions (DNFBPs).

Deficiencies

• The Financial Intelligence Centre (FIC) had not yet started providing feedback on suspicious transaction reports submitted by DNFBPs.
• Despite conducting examinations, this deficiency has been deemed “not addressed” by authorities.

Virtual Assets and Service Providers

The report also raised concerns over Ethiopia’s progress in implementing Recommendation 15, which deals with new technologies such as virtual assets (VAs) and virtual asset service providers (VASPs). The country was found to have:

• Launched a second round of risk assessment on VA activities and operations of VASPs.
• Not developed requirements for licensing VASPs or identifying natural or legal persons that carry out VA activities.

Consequences

As a result of these findings, FATF has re-rated Ethiopia’s technical compliance with Recommendation 34 from “Partially Compliant” to “Largely Compliant”. However, the country remains in enhanced follow-up and will continue to inform the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) of its progress in improving the implementation of AML/CFT measures.

Full Report

The full report can be accessed on the FATF website.