Guinea’s Anti-Money Laundering and Counter-Terrorist Financing Efforts Fall Short

Despite efforts to strengthen its anti-money laundering (AML) and counter-terrorist financing (CFT) regime, Guinea still faces significant challenges in combating financial crimes. A recent report by the Financial Action Task Force (FATF) has highlighted a range of concerns, including weaknesses in national cooperation and coordination, limited understanding of money laundering and terrorist financing risks, and inadequate implementation of preventive measures.

Key Findings

• Guinea’s AML/CFT regime is fundamentally limited by:
  • Low banking rate
  • Widespread use of cash
  • Significant informal sector
  • Vast borders and corruption
• New laws and institutional reforms have been adopted, but their impact remains unclear due to their recent nature.

Cooperation and Coordination

• National cooperation and coordination of AML/CFT activities are lacking.
• No initiative has been taken to establish an inter-agency cooperation mechanism.
• Development of an action plan to mitigate identified risks is dependent on resolving challenges related to inter-agency cooperation and coordination.

Financial Intelligence

• Guinea’s system for producing, enriching, and making use of financial intelligence is based on the Financial Intelligence Unit (FIU).
• Few law enforcement agencies use financial intelligence when investigating predicate offenses such as corruption and tax fraud.
• The FIU is not a member of the Egmont Group of FIUs, hindering its access to foreign financial intelligence.

Detection and Communication

• The system for detecting and communicating false declarations or non-declaration of cash and bearer negotiable instruments is defective and almost dysfunctional.
• This mechanism could have been an enriching source of information for the FIU and other law enforcement agencies in detecting money laundering or terrorist financing cases.

Investigations and Prosecutions

• Money laundering-related investigations and prosecutions are rare due to:
  • Lack of prioritization
  • Inadequate resources
  • Lack of sanctions
• The Financial Intelligence Unit (FIU) is responsible for investigating and prosecuting financial crimes, but it lacks the necessary resources and expertise.

Supervision

• Bank supervision is well-structured in Guinea, with a risk-based approach.
• However, other sectors such as insurance, foreign exchange bureaus, microfinance institutions, and electronic money institutions lack a risk-based approach.

Transparency

• The transparency of legal persons and legal arrangements is constrained by structural challenges and poor understanding of ML/TF risks linked to such entities.
• Key stakeholders are not aware of the issues, and the country does not impose sanctions for non-compliance with relevant obligations.

International Cooperation

• Guinea’s use of international cooperation in AML/CFT is insignificant due to:
  • Lack of mechanism
  • Inadequate resources
• The FATF report concludes that Guinea needs to address these shortcomings to effectively combat financial crimes and protect its financial system from abuse.

Conclusion

Guinea’s anti-money laundering and counter-terrorist financing efforts face significant challenges. To effectively combat financial crimes, the country needs to address these shortcomings and implement effective reforms. The international community should provide support and assistance to help Guinea strengthen its AML/CFT regime and protect its financial system from abuse.