Financial Crime World

Senegal Fights Money Laundering and Terrorist Financing, but Faces Challenges

The government of Senegal has made significant progress in combating money laundering (ML) and terrorist financing (TF), but faces substantial challenges in implementing effective measures to prevent these crimes.

Progress Made

According to a report by the Financial Action Task Force (FATF), Senegal’s financial intelligence unit (FIU) has reported ongoing investigations, but no convictions have been secured for TF cases. The country has also made progress since the Mutual Evaluation conducted in 2009 with the adoption of the Counter Financing of Terrorism Law No. 2009-16 of March 2nd, 2009.

Challenges Faced

Despite these efforts, Senegal faces several challenges:

  • Lack of designated regulatory or supervisory authorities: The country lacks designated regulatory or supervisory authorities for non-bank financial businesses and professions (DNFBPs).
  • Insufficient understanding of ML/TF risks: There is a need for improved understanding of ML/TF risks among DNFBPs.
  • Poor coordination and policy definition: Better coordination and policy definition are needed to combat these crimes.
  • Limited supervision and prevention measures: Senegal needs to strengthen its supervision and prevention measures for all reporting entities, including DNFBPs.

Key Areas for Improvement

The FATF report highlighted several key areas that require improvement:

  • National Risk Assessment (NRA) Report: The NRA Report adopted in August 2017 represents significant progress in identifying and understanding ML/TF risks. However, the assessment did not take into account manual foreign exchange dealers, real estate dealers, and precious stones and metals dealers in determining the overall level of ML/TF risk.
  • Fund-raising activities: Senegal’s authorities have failed to sufficiently consider the risk of local fund-raising actions that may be used to finance terrorist activities.

Recommendations

To address these challenges, Senegal needs to:

  • Strengthen its NRA process
  • Improve coordination and policy definition
  • Enhance supervision and prevention measures for all reporting entities, including DNFBPs

Overall, Senegal faces significant challenges in implementing effective measures to prevent ML/TF. With further efforts, the country can strengthen its anti-money laundering and combating the financing of terrorism (AML/CFT) framework and improve its ability to combat these crimes.