Sao Tome and Principe Removed from FATF Blacklist
A Significant Development for the Country
In a major breakthrough, Sao Tome and Principe has been removed from the Financial Action Task Force (FATF) blacklist after demonstrating significant progress in addressing strategic deficiencies in its anti-money laundering and combating terrorism financing (AML/CFT) framework.
Background on FATF Blacklisting
The FATF is an inter-governmental organization that aims to promote global efforts against money laundering, terrorist financing, and the proliferation of weapons of mass destruction. It maintains a list of countries with weak AML/CFT frameworks, which are subject to increased scrutiny from the international community. The blacklisting can have severe economic consequences for affected countries.
Progress Made by Sao Tome and Principe
Sao Tome and Principe has faced significant challenges in implementing effective AML/CFT regulations and infrastructure. However, in recent years, the country has taken concrete steps to address these concerns:
- Adoption of new legislation: The country adopted a new law on AML/CFT, which was published in the Official Gazette in October 2013.
- Establishment of a Financial Information Unit (UIF): A UIF was set up to receive, report, analyze, and exchange information about suspect transactions.
Key Provisions of the New Law
The new law includes provisions for:
- Defining crimes of money laundering and terrorism financing activities
- Holding legal entities criminally liable
- Identifying responsible individuals who manage legal entities, including lawyers
- Outlining sanctions and asset confiscation in the event of a conviction
- Implementing preventative measures for persons and entities subject to the law
Challenges Remain Ahead
While Sao Tome and Principe’s removal from the blacklist is a significant achievement, it also highlights the challenges faced by small countries like Sao Tome and Principe in complying with international AML/CFT standards. The country has limited resources to investigate and combat financial crimes, making it vulnerable to these types of activities.
As such, it remains to be seen whether Sao Tome and Principe can continue to make progress in meeting international standards, particularly given the increasing regulatory demands imposed by the FATF and other organizations.