Financial Crime World

Senegal: Grappling with the Consequences of Financial Crime

Subtitle

  • A look at the impact of money laundering, terrorism financing, and proliferation on the West African nation

Introduction

Senegal, a country in West Africa, is dealing with the repercussions of financial crimes including money laundering, terrorism financing, and proliferation. The Financial Action Task Force (FATF) and the Inter-Governmental Action Group against Money Laundering in West Africa (GIABA) have identified the need for significant strengthening of Senegal’s Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) measures [1].

Assessment of Senegal’s AML/CFT System

  • Senegal’s level of compliance with the FATF 40 Recommendations was assessed in a report by FATF and GIABA [1]
  • Key areas for improvement:
    • Development and implementation of a risk-based approach
    • Enhancement of customer due diligence measures
    • Better coordination and information sharing among relevant authorities

Economic Consequences of Financial Crime

  • Estimated illicit financial flows from drug trafficking, money laundering, and other criminal activities in Senegal: $80 million - $120 million per year [2]
  • Funds could be invested in infrastructure, education, and other development initiatives

Threat of Terrorism Financing

  • Increasing number of cases related to terrorism financing reported by Senegalese Finance Ministry’s Financial Intelligence Unit (UIFS) [3]
  • Lack of adequate capabilities to effectively counter this threat in Senegal’s AML/CFT system [1]

Regional Challenges

  • West and Central African countries, particularly those with porous borders, face an acute challenge in mitigating the effects of financial crime [4]
  • International support and commitment to robust AML/CFT measures are essential for these countries

References

  1. Financial Action Task Force (FATF) and Inter-Governmental Action Group against Money Laundering in West Africa (GIABA), “Mutual Evaluation Report Senegal, 2018,” (May 2018), https://www.fatf-gafi.org/en/publications/Mutualevaluations/Mer-senegal-2018.html
  2. Global Initiative Against Transnational Crimes (GI-TOC), “Money, Power and Militancy in West Africa: Opportunities for Action,” (2019), https://globalinitiative.net/wp-content/uploads/2019/10/GI-TOC_Money-Power-and-Militancy-in-West-Africa.pdf
  3. Africanews, “Senegal: Fighting terrorism financing in West Africa,” (May 2, 2019), https://www.africanews.com/2019/05/02/senegal-fighting-terrorism-financing-in-west-africa/
  4. United Nations Office on Drugs and Crime, “West and Central Africa,” https://www.unodc.org/wca