Financial Crime World

Lesotho Establishes Institutionalised Anti-Money Laundering and Combating the Financing of Terrorism Regime

Strengthening National Cooperation and Regulation

The government of Lesotho has established an institutionalised anti-money laundering and combating the financing of terrorism (AML/CFT) regime to prevent the misuse of its financial system for illegal activities. The Financial Intelligence Unit (FIU) report highlights the importance of strengthening national cooperation, enhancing awareness and appreciation of AML/CFT, and regulating accountable institutions.

National Interagency Committee

To achieve this goal, a National Interagency Committee has been established, comprising:

  • Finance and Development Planning
  • Justice Law and Constitutional Affairs
  • Home Affairs and Public Safety
  • Foreign Affairs and International Relations
  • Central Bank of Lesotho
  • Lesotho Revenue Authority

The committee will define the mandate of the AML/CFT regime and ensure its implementation.

Effective Legislation

Effective legislation is crucial in combating money laundering and terrorist financing. The report highlights the importance of:

  • Criminalising money laundering and terrorist financing
  • Confiscating proceeds of crime
  • Establishing a Criminal Asset Recovery Fund

International Cooperation

Lesotho has also ratified international and regional instruments and is seeking membership in the Egmont Group to strengthen international cooperation. The country has developed legal treaties and mutual legal assistance legislation to enhance information sharing with other countries.

Challenges and Risks

Despite these efforts, several challenges and risks remain:

  • Lack of coordination at a higher management level
  • Lack of MOUs among relevant government agencies
  • Absence of FIU
  • Lack of admissibility of electronic data as evidence in the courts of law
  • Capacity building for both financial and human resources
  • Lack of necessary infrastructure

Way Forward

To overcome these challenges, Lesotho aims to:

  • Implement the AML/CFT regime by 1st April, 2009
  • Establish a comprehensive framework to regulate accountable institutions
  • Enhance awareness and appreciation of AML/CFT among relevant stakeholders
  • Secure funding for AML/CFT activities
  • Assess money laundering and terrorist financing risks and vulnerabilities

By implementing these strategies, Lesotho aims to prevent the misuse of its financial system for illegal activities and maintain a strong reputation as a stable and secure country.