SAO TOME AND PRINCIPE: BANKS DEAL WITH FINANCIAL CRIME

Introduction

Located in the Gulf of Guinea, Sao Tome and Principe’s economy is growing, driven by tourism and agriculture. However, its isolation and dependence on external factors make it vulnerable to financial crime.

Financial Institutions’ Response to Financial Crime

Banks in Sao Tome and Principe have implemented measures to prevent financial crime, including anti-money laundering (AML) and combating the financing of terrorism (CFT) protocols. However, these protocols do not meet global standards, and regulatory and supervisory processes lack capacity to respond to money laundering and terrorist financing risks.

Banks have implemented AML/CFT protocols, but they need to be strengthened to meet global standards.
Regulatory and supervisory processes lack capacity to respond to financial crime risks.

Challenges and Vulnerabilities

The country’s economy is vulnerable to external shocks due to its isolation, high unemployment, and poverty rates. Private sector development faces constraints, including a lack of investment attractiveness. The government is working to address deficiencies in the AML/CFT protocol, but they continue to pose a vulnerability for the country.

Isolation and dependence on external factors make the economy vulnerable.
High unemployment and poverty rates contribute to economic instability.
Deficiencies in the AML/CFT protocol pose a vulnerability for the country.

Civil society plays an essential role in addressing issues such as child labor and cooperating with authorities to prevent organized crime. However, the sector is relatively small, and a lack of funding hampers NGOs’ ability to operate effectively.

Civil society plays a crucial role in addressing social issues.
A lack of funding hinders the effectiveness of civil society organizations.

Criminal Justice and Security

The judiciary in Sao Tome and Principe is mostly independent, but there have been cases of interference and undue influence over courts as well as corruption within the judiciary. The police and security forces lack equipment, capacity, and resources necessary to respond to crime comprehensively.

Cases of interference and corruption undermine the independence of the judiciary.
Police and security forces lack the necessary resources to respond effectively to crime.

Oversight and Regulation

Oversight of national police, customs, and immigration authorities, as well as the military, is adequate; however, citizens express high levels of mistrust due to perceived inefficiency and corruption. The government is working to address these issues and improve the overall efficiency of law enforcement agencies.

Oversight of law enforcement agencies is necessary but needs improvement.
Citizens’ trust in law enforcement agencies can be improved by addressing corruption and inefficiency.

Conclusion

In conclusion, while financial crime remains a relatively minor concern in Sao Tome and Principe, the country’s economy faces vulnerabilities due to its isolation, dependence on external factors, and lack of investment attractiveness. Banks have implemented measures to prevent financial crime, but these efforts need to be strengthened to meet global standards. The government is working to address deficiencies in the AML/CFT protocol, and civil society plays an essential role in addressing issues related to organized crime. However, more needs to be done to improve the overall efficiency of law enforcement agencies and ensure that they have the necessary resources to respond effectively to financial crime.