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Sierra Leone Remains Vigilant Against Terror Financing Risks Amid US Designation

Freetown, Sierra Leone - The government of Sierra Leone has reiterated its commitment to combating terrorist financing (TF) and money laundering (ML), despite being designated by the United States as a country with significant TF risks.

Combating Money Laundering and Terrorist Financing

In a recent report, the Financial Action Task Force (FATF) highlighted several vulnerabilities in Sierra Leone’s anti-money laundering and combating the financing of terrorism (AML/CFT) framework. The report noted that while the country has taken steps to improve its AML/CFT regime since 2007, there are still significant deficiencies that need to be addressed.

Areas for Improvement

The FATF report identified several areas where Sierra Leone needs to enhance its efforts, including:

  • Confiscation
  • TF investigation and prosecution
  • Supervision and monitoring of non-bank financial institutions and designated non-financial businesses and professions (DNFBPs)

Efforts to Combat ML/TF

Despite these challenges, the government has remained vigilant in its efforts to combat ML/TF. In 2012, Sierra Leone re-enacted its AML/CFT Act and amended it in 2019, which has considerably enhanced its legal framework.

The country has also established a Financial Intelligence Unit (FIU) as an independent administrative unit and created an Anti-Corruption Division of the court to handle corruption and financial crimes. Additionally, regulations have been issued to reinforce the legislative framework and achieve significant compliance with FATF recommendations.

Ongoing Challenges

However, Sierra Leone’s TF risks remain high due to its vulnerabilities in designating entities and individuals, lack of specific guidelines for international cooperation, and absence of a structured system for managing and monitoring requests.

Addressing Vulnerabilities

The country’s authorities are aware of these vulnerabilities and have taken steps to address them. In 2017, Sierra Leone completed its National Risk Assessment (NRA), which has improved the level of understanding of ML/TF risks across the board. The FIU played a pivotal role in the NRA process and has good understanding of risk in the country.

The government has also adopted a two-year Action Plan based on the findings of the NRA, which prioritizes key areas of deficiencies identified in the report. Implementation of the plan is ongoing, although inadequate resources among key competent authorities are affecting effective implementation.

Commitment to Enhancing AML/CFT Framework

Sierra Leone’s efforts to combat ML/TF are being closely monitored by international partners, and the country remains committed to enhancing its AML/CFT framework to prevent the misuse of its financial system for TF activities.