Financial Crime World

Mozambique Enacts Stringent Banking Regulations to Prevent Financial Crime

The Government of Mozambique has taken significant steps to prevent financial crime by enacting a new Anti-Money Laundering/Combating Terrorist Financing Law (AML/CFT Law) and Regulation.

Background

The AML/CFT Law, which came into effect on August 28, 2023, aims to prevent the misuse of Mozambique’s financial system for money laundering, terrorist financing, and other related offenses. The law revokes the previous anti-money laundering regime and establishes new obligations for gatekeeper entities, including:

  • Banks
  • Financial institutions
  • Non-financial entities
  • Lawyers
  • Notaries
  • Independent legal professionals

Key Requirements

Under the new law, these entities are required to:

  • Identify customers and their ultimate beneficial owners (UBOs)
  • Verify customer identity by valid documentary evidence
  • Notify suspicious operations to the Financial Intelligence Office of Mozambique (GIFiM)

Gatekeepers must also obtain information on:

  • “Politically Exposed Persons” who hold or have held high-level public office positions in Mozambique or abroad
  • Names of relevant persons with management positions in legal persons and other autonomous estates

Supervisory Entities

Supervisory entities, including:

  • Bank of Mozambique
  • Insurance Supervision Institute of Mozambique
  • Financial Information Office of Mozambique
  • Gaming General Inspectorate
  • Ministry of Mineral Resources and Energy
  • Ministry of Industry and Commerce

will be responsible for imposing anti-money laundering requirements on gatekeeper entities.

Consequences of Non-Compliance

Failure to comply with the duties and obligations under the law constitutes a misdemeanor punishable by fines ranging from:

  • 2 million to 10 million Mozambican Meticals (MZN) for financial entities
  • 1 million to 5 million MZN for non-financial entities

Public Awareness Campaign

The Ministry of Industry and Commerce has announced plans to launch a public awareness campaign to educate the general public on the importance of preventing financial crime and the role they can play in reporting suspicious transactions.

Conclusion

The AML/CFT Law aims to protect the integrity of Mozambique’s financial system and prevent its misuse by criminal organizations. The Government is committed to implementing the law effectively and ensuring that all gatekeeper entities comply with their obligations under the law.