Financial Action Task Force (FATF) Report: Evaluation of Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) Measures in Central African Republic (CAR)
The Financial Action Task Force (FATF) has released a report evaluating the effectiveness of AML/CFT measures in the Central African Republic (CAR). The report highlights various weaknesses and challenges in CAR’s AML/CFT system.
A. AML/CFT Framework and Powers
While CAR has a well-established legal framework for AML/CFT, including laws on money laundering, terrorism financing, and terrorist financing, there are significant gaps in implementation and enforcement.
- CAR has enacted laws to combat money laundering and terrorist financing.
- However, the country lacks effective implementation and enforcement mechanisms.
- The Central African Economic and Monetary Community (CEMAC) Regulation is not fully implemented in CAR.
B. Risks and General Situation
CAR faces significant security and political challenges that hinder economic and social development. The country has a fragile security situation, with armed groups present on its territory.
- CAR is exposed to various ML/TF risks, including misappropriation of public funds, illicit trafficking in precious stones and metals, drug trafficking, corruption, and human trafficking.
- Limited understanding of ML/TF risks among DNFBPs (Designated Non-Financial Businesses and Professions).
- Inadequate implementation of AML/CFT measures.
- Weaknesses in control and supervision systems for financial institutions and DNFBPs.
Shortcomings Identified by the Report
The report highlights several shortcomings in CAR’s AML/CFT system, including:
- Limited understanding of ML/TF risks among DNFBPs
- Inadequate implementation of AML/CFT measures
- Weaknesses in control and supervision systems for financial institutions and DNFBPs
- Lack of transparency in legal entities and arrangements, making it difficult to track beneficial owners
- Insufficient sanctions for non-compliance with information and transparency obligations
Overall, the report highlights significant weaknesses in CAR’s AML/CFT system, which pose a risk to the country’s financial stability and international reputation.