Samoa Tightens the Screws on Banking Secrecy Laws to Combat Money Laundering

Samoa has taken a significant step towards preventing the misuse of its financial system by introducing strict laws to combat money laundering. The country’s authorities have recognized that money laundering poses significant risks to economic and social stability, as well as the reputation of the financial sector.

What is Money Laundering?

Money laundering is the process by which criminals attempt to conceal the true origin and ownership of the proceeds of their illegal activities. It involves three stages:

• Placement: Placing dirty money into the financial system
• Layering: Hiding its true origin through multiple transactions
• Integration: Integrating the money with legitimate funds and assets

Samoa’s Money Laundering Prevention Act

The country has introduced the Money Laundering Prevention Act, administered by the Central Bank of Samoa. The Governor of the Central Bank serves as the Money Laundering Prevention Authority, while the Money Laundering Prevention Task Force provides advisory support and works closely with government agencies, departments, and the Financial Intelligence Unit.

Border Currency Report

The country has also introduced a border currency report, which requires individuals carrying cash or negotiable bearer instruments worth $20,000 or more to declare them. Failure to comply can result in fines of up to $10,000 and five years’ imprisonment.

Financial Institution Obligations

Financial institutions are obligated to adhere to certain standards to prevent financial crime, including:

• Record Keeping: Keeping relevant records for at least five years
• Customer Acceptance Policies: Developing clear customer acceptance policies
• Customer Identification: Proper identification of customers
• New Customer Procedures: Establishing procedures for identifying new customers

International Cooperation

The Central Bank of Samoa has emphasized the importance of international cooperation in combating money laundering, and has called on all stakeholders to work together to prevent this illegal activity. With these new laws in place, Samoa is sending a strong message that it will not tolerate financial secrecy and will take decisive action to protect its financial system.

By implementing these measures, Samoa aims to prevent the misuse of its financial system and maintain economic stability, social stability, and the reputation of its financial sector.