Ghana’s Fight Against Money Laundering and Terrorist Financing: A Review of Operations
Kumasi, Ghana - In an effort to enhance its fight against money laundering and terrorist financing, Ghana has reviewed its National Risk Assessment (NRA) in line with the Financial Action Task Force (FATF) 40 Recommendations. The review process, conducted from 2016 to 2019, aimed at identifying and evaluating threats, vulnerabilities, and their impact on the country.
Background
According to a Mutual Evaluation Report (MER) conducted by the FATF in 2016, Ghana faced several challenges in its compliance with Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) measures. The report highlighted that certain sectors, including extractive and petroleum, cocoa, and hotel industries, were not included in the earlier assessment.
Review Process
The NRA review process involved two phases: re-composition of working groups and validation of working group reports. The World Bank provided technical assistance and guidance to ensure effective use of a National Risk Assessment Tool (including excel templates).
Data Collection
Data was collected from various institutions, including financial intelligence agencies, law enforcement agencies, and regulated sectors such as banking and finance, insurance, and securities. However, access to data was limited due to lack of information or statistical units in some cases.
Challenges
The review process identified several challenges, including:
- Lack of knowledge on money laundering (ML) and terrorist financing (TF) issues within some sectors
- Inadequate management information systems (MIS)
- Fear of repercussions for divulging information related to their businesses
Threat Analysis
Threat analysis revealed that crimes such as fraud, stealing, robbery, drug trafficking, corruption, and tax evasion are the most rampant in Ghana. The extractive, petroleum, and hotel sectors were identified as high-risk areas. Cybercrime was also found to be a significant issue.
National Vulnerability Assessment
The national vulnerability assessment focused on 24 areas with varying levels of capacity to detect and prevent ML/TF. The overall threat was rated as medium-high.
Limitations
The review process was not without its limitations. Access to data was limited due to lack of information or statistical units in some cases. Some institutions did not provide the required information, while others provided it late. Validation of data was also challenging due to the difficulty in getting institutions to validate their information.
Next Steps
Ghana has since developed a National AML/CFT Policy document and Action Plan, which will assist in the allocation of resources and revising guidance for “Accountable Institutions” to ensure compliance with the AML/CFT regime. The NRA process is expected to support the government’s declared fight against money laundering, illicit financial flows, and transnational organized crimes.
Conclusion
Ghana’s review of its NRA has identified several challenges and vulnerabilities in its AML/CFT regime. The government has taken steps to address these issues, including developing a National AML/CFT Policy document and Action Plan. However, more needs to be done to strengthen the country’s fight against money laundering and terrorist financing.