Financial Crime World

Samoan Authorities Tackle Offshore Sector Risks Amid Low Levels of Criminality

APIA, SAMOA - The Samoan government has taken steps to address the risks associated with its offshore sector, despite low levels of criminal activity.

National Risk Assessment Highlights Key Areas of Concern

The country’s National Risk Assessment (NRA) highlights the importance of the domestic banking sector in preventing money laundering (ML) and terrorist financing (TF). The NRA also identifies International Business Companies (IBCs), money transfer operators (MTOs), and the cross-border movement of cash as areas of higher risk.

Low Levels of Criminal Activity, but Inherent Risks Remain

While the level of domestic proceeds-generating crimes appears to be low, with main relevant crime types being relatively low-level fraud and drugs cases, authorities acknowledge that the offshore sector poses inherent risks. The report notes a small number of foreign requests for information relating to Samoan IBCs, which indicate possible misuse for ML or associated predicate offenses.

Improvements in Technical Compliance, but Deficiencies Remain

The NRA highlights Samoa’s improvements in technical compliance with anti-money laundering (AML) and counter-terrorist financing (CFT) standards since its 2006 mutual evaluation. However, some important deficiencies remain, including in relation to criminalization and prevention of ML, TF, and proliferation financing.

Areas for Improvement

  • Conduct a more comprehensive assessment of TF risks and those associated with the recently established casino sector
  • Develop a national AML/CFT strategy
  • Improve operational-level effectiveness in areas such as supervision, use of financial intelligence, ML investigations, and proliferation financing financial sanctions

Official Comment

“The Samoan authorities are aware of the inherent risks posed by the offshore sector and have taken steps to address them,” said an official from the country’s Financial Intelligence Unit. “We recognize that there is still room for improvement, particularly in terms of risk assessment and preventive measures.”

Conclusion

The report concludes that while Samoa has made progress in AML/CFT compliance and effectiveness, it remains important for the country to continue addressing these risks to prevent ML and TF.