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Financial Crime Examples in Sao Tome and Principe: A Positive Trajectory towards Transparency
In recent years, Sao Tome and Principe has made significant strides in combating financial crime and corruption. According to the State Department’s Office of Investment Affairs’ 2015 Investment Climate Statement, the government has undertaken various reforms to reduce corruption among civil servants and improve transparency in public transactions.
Anti-Corruption Law
One notable example is the new anti-corruption law approved by the government in 2012. This law aims to prevent and combat corruption by requiring all payments to government entities exceeding USD 5 to be made directly at the Central Bank, while salary payments to civil servants are now paid directly to their accounts at commercial banks.
Oil Revenue Management
The country has also implemented an oil revenue management law, enacted in 2004, to ensure responsible management of any future oil revenue. Sao Tome and Principe is a candidate country for the Extractive Industries Transparency Initiative (EITI) and has taken steps to review and update existing contracts with foreign companies to promote liberalization and free market competition.
Anti-Money Laundering/Counter-Terrorist Financing Law
The government has denounced corruption and pledged to take necessary measures to prevent and combat it. In 2013, the parliament adopted a fully amended and restated anti-money laundering/counter-terrorist financing (AML/CFT) law, which complies with international standards.
Key Provisions of the AML/CFT Law
- Investigating suspect transactions
- Designating persons and entities responsible for criminal activities
- Imposing sanctions on those involved in money laundering and terrorism financing
The Financial Information Unit has been designated as the central agency responsible for investigating suspect transactions.
Progress Made
Sao Tome and Principe has made significant progress in addressing financial crime, having been removed from the Financial Action Task Force’s (FATF) list of countries with strategic deficiencies in their AML/CFT standards. The country is a member of the Inter-Governmental Action Group against Money Laundering in West Africa, a FATF-style regional body.
Challenges Remaining
Despite these efforts, Sao Tome and Principe does not have a designated agency responsible for combating corruption. However, the government has signed and ratified the UN Anticorruption Convention and has pledged to take necessary measures to prevent and combat financial crime.