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Namibia’s Battle Against Money Laundering, Terrorism Financing, and Proliferation: A Look into Virtual Assets and Corruption
As Namibia acceded to the global convention on combating money laundering, terrorism financing, and proliferation (ML/TF/PF) in August 2004, the country has been working tirelessly to implement its obligations. The Financial Intelligence Centre (FIC) plays a crucial role in this fight, and its efforts have led to the issuance of directives and guidance on virtual assets and service providers.
What are Virtual Assets?
Virtual assets, often referred to as crypto or digital assets, are cryptographic or digital representations of value that can be used for payment or investment purposes. While they do not meet the criteria for consideration as a fiat currency in Namibia, they can be exchanged for funds, goods, or other virtual assets among parties who choose to do so.
What are Virtual Asset Service Providers?
A Virtual Asset Service Provider (VASP) is any natural or legal person that conducts one or more activities related to the exchange of virtual assets and fiat currencies, including:
- Exchange
- Transfer
- Safekeeping
- Administration
- Participation in financial services
VASPs include entities such as exchange houses, agents, brokers, mixers, traders, and virtual asset managers.
FIC’s Regulation of VASPs
The FIC has issued a directive and guidance on VASPs to ensure that they comply with Namibia’s ML/TF/PF framework. The directive outlines the requirements for VASPs, including:
- Customer due diligence
- Ongoing monitoring
- Reporting suspicious transactions
Corruption: A Major Concern
Corruption is a significant threat to Namibia’s economic stability and security. It can take various forms, including:
- Bribery
- Kickbacks
- Illegal gratuities
- Collusion
The FIC plays a crucial role in fighting corruption by receiving and analyzing data related to predicate offences, such as money laundering, terrorism financing, and proliferation.
FIC’s Role in Fighting Corruption
The FIC works closely with relevant stakeholders, including:
- Regulatory bodies
- The private sector
- Law enforcement authorities
- The Office of the Prosecutor General
It receives and analyzes data related to predicate offences and provides intelligence disclosures to competent authorities, including the Anti-Corruption Commission (ACC), to facilitate investigations, prosecutions, and asset forfeiture activities.
Accountability and Reporting Institutions
Accountable institutions are prohibited from sharing suspicious transaction reports (STRs) with their financial group or any other entity. However, they must obtain certified copies of identification information from their clients.
As Namibia continues to combat ML/TF/PF, it is essential that all stakeholders work together to prevent the misuse of virtual assets and corruption. The FIC’s efforts will play a critical role in ensuring the country’s economic stability and security.