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Central African Republic Fails to Effectively Combat Money Laundering and Terrorist Financing

Bangui - The Central African Republic (CAR) has been criticized for its inadequate efforts to combat money laundering (ML) and terrorist financing (TF). A recent report highlights several weaknesses in the country’s system, including:

Lack of Expertise among Investigative and Prosecuting Authorities

• The CAR’s investigative and prosecuting authorities do not adequately identify or locate assets that could be seized and confiscated as part of ML investigations.
• There is no formal mechanism for managing such assets or an entity dedicated to this task.

Inconsistent Identification of Predicate Offences

• The country has failed to effectively prevent the misuse of legal entities and arrangements, including a lack of transparency in ownership information and inadequate checks on the authenticity of provided data.
• Supervisors carrying out generally satisfactory due diligence despite weaknesses in identifying beneficial owners.

Complicated Situation

• Fragile security environment, political instability, and recurrent armed conflicts create a range of ML/TF risks, including:
  • Misappropriation of public funds
  • Illicit trafficking
  • Corruption
  • Human trafficking

New Law Raises Concerns

• In an effort to boost its economy, the CAR passed a law governing transactions linked to crypto-currencies in April 2022, establishing bitcoin as an official currency.
• However, this move has raised concerns about the potential for ML/TF risks associated with virtual assets (VAs).

Recommendation

• The CAR needs to strengthen its AML/CFT framework and improve cooperation with international partners to combat ML/TF effectively.
• Authorities must address identified weaknesses to prevent the exploitation of its financial system by criminals.

Full Report Available

For a full copy of the report, please contact our editorial team at [insert contact information].