DRC’s Non-Membership of FATF Hinders Fight Against Money Laundering and Terrorism Financing

The Democratic Republic of Congo (DRC) has failed to join the Financial Action Task Force (FATF), a major international body combating money laundering and terrorist financing. This non-membership, combined with the lack of updates to its legal framework in accordance with FATF recommendations, has created significant obstacles for the DRC’s financial system.

Challenges Faced by the DRC

The DRC government has introduced Law No. 22/068 to strengthen preventive measures and introduce new obligations to combat money laundering, terrorist financing, and the proliferation of weapons of mass destruction. However, despite these efforts, the country’s financial system remains vulnerable to money laundering and terrorist financing.

Key Measures Introduced by the Law

The law introduces several key measures, including:

• The obligation for any transaction in Congolese francs or other currency equal to or greater than US$10,000 to be made by electronic means;
• The requirement for individuals entering or leaving the DRC to declare cash and negotiable instruments equal to or greater than US$10,000;
• The establishment of a system for reporting suspicious transactions;

Harmonization of Banking System

The law also aims to harmonize the banking system by creating common minimum standards of supervision for credit institutions.

Ongoing Challenges

Despite these efforts, the DRC’s financial system remains vulnerable to money laundering and terrorist financing. The country’s non-membership of FATF and lack of updates to its legal framework hinder its ability to effectively combat these threats.

Digital Technologies Present New Challenges

The introduction of digital technologies in the country has created new challenges for the financial sector. The recent adoption of Law No. 23/010 on Digital Code aims to regulate the digitally enabled services sector, but it remains to be seen whether this will be enough to address the ongoing challenges faced by the DRC’s financial system.

Conclusion

In conclusion, the DRC’s non-membership of FATF and lack of updates to its legal framework have hindered its efforts to combat money laundering and terrorist financing. The introduction of new laws and regulations aims to strengthen preventive measures, but it remains to be seen whether these efforts will be enough to effectively address these threats.