Financial Crime World

SAO TOME AND PRINCIPE FALLS SHORT ON COMPLIANCE WITH MONEY LAUNDERING LAWS

A recent report has highlighted areas where the Republic of Sao Tome and Principe needs to improve its compliance with international money laundering laws. The country’s financial sector is vulnerable to illicit activities, according to the findings.

RATING: PARTIALLY COMPLIANT

The report assessed Sao Tome and Principe’s implementation of the Financial Action Task Force (FATF) Recommendations, which aim to prevent and combat money laundering and terrorist financing. While the country has made progress in some areas, it remains partially compliant with several key requirements.

KEY DEFICIENCIES

Among the shortcomings identified are:

  • Non-profit organisations: Sao Tome and Principe does not have adequate laws or regulations to regulate non-profit organisations, leaving them vulnerable to money laundering activities.
  • Financial institution secrecy laws: The country’s banking secrecy laws do not provide for international cooperation in the investigation and prosecution of money laundering offences.
  • Transparency and beneficial ownership: Sao Tome and Principe does not have adequate laws or regulations to ensure transparency and disclose beneficial ownership of legal persons and arrangements.
  • Regulation and supervision of DNFBPs: The country lacks effective regulation and supervision of designated non-financial businesses and professions (DNFBPs), such as lawyers, accountants, and real estate agents.

CALL TO ACTION

The report urges Sao Tome and Principe to address these shortcomings by enacting new laws or regulations, strengthening its regulatory framework, and enhancing international cooperation. Failure to do so may lead to reputational damage and economic consequences for the country. The government must take decisive action to ensure that its financial sector is transparent, accountable, and resilient against illicit activities.

IMPLEMENTATION REQUIRED

Sao Tome and Principe must implement the necessary reforms to achieve full compliance with international money laundering laws. This will require a sustained effort from the government, regulatory agencies, and industry stakeholders to strengthen the country’s anti-money laundering framework. The report serves as a wake-up call for Sao Tome and Principe to take concrete steps towards protecting its financial system and maintaining a positive reputation in the global community.