Namibia Makes Significant Progress Against Anti-Money Laundering, But Risks Blacklisting Due to Outstanding Challenges
The Minister of Finance and Public Enterprises, Iipumbu Shiimi, has announced that Namibia has made significant strides in meeting international standards against money laundering. However, the country still faces 13 outstanding challenges that could lead to blacklisting and increased monitoring.
Background
Since December 2022, Namibia has been working diligently towards meeting the standards set by the Eastern and Southern African Anti-Money Laundering Group (ESAAMLG) and the Financial Action Task Force (FATF). The global task force is responsible for monitoring money laundering and terrorist financing activities worldwide.
Challenges Identified
The FATF’s Mutual Evaluation Report raised concerns about increasing criminal cases linked to financial proceeds, damaging Namibia’s financial and legal systems’ credibility. The report highlighted that most of the proceeds were laundered through banks, unit trust schemes, and asset management-related financial services. Notable examples include:
- Fishrot scandal
- Value-Added Tax (VAT) scam
- Namibia SME Bank fraud
Progress Made
In response to the evaluation findings, Namibia passed four new laws and amended nine existing ones by August 2023. A dedicated project team was formed to ensure the effective implementation of these legal and policy frameworks, reporting regularly to relevant authorities and stakeholders.
Namibia submitted its final progress report to the FATF ICRG towards the end of 2023. The country’s team engaged with the FATF ICRG joint group in January 2024 in Abu Dhabi, showcasing its commitment to addressing the evaluation findings.
Outstanding Challenges
Preliminary indications reveal that Namibia passed the technical compliance test and made progress in five out of the 11 key areas. However, Shiimi warned that the remaining challenges could lead to blacklisting and increased monitoring if not addressed promptly.
What’s Next?
Namibia is expected to continue working towards meeting the international standards set forth by the ESAAMLG and FATF. The country must address the outstanding challenges to avoid blacklisting and maintain its credibility in the global financial system.