The Financial Action Task Force recently added Burkina Faso, the Cayman Islands, Morocco and Senegal to its jurisdictions list under increased monitoring, joining 15 other countries. The identified deficiencies vary for each jurisdiction, but they include maintaining comprehensive beneficial ownership information and expanding the operations of countries’ financial intelligence units.

According to FATF, these countries only partially fulfil international rules for fighting terrorism financing and money laundering. For instance, FATF, in a report, said the Cayman Islands government needs to impose effective administrative penalties and enforcement actions against entities involved in money-laundering violations, as well as implement adequate sanctions in cases where accurate and timely beneficial ownership information isn’t provided.

FATF, which evaluates anti-money-laundering and counter-terrorism-financing laws of 205 jurisdictions worldwide, said the Covid-19 pandemic had impacted its evaluations of countries, delaying some of its on-site reviews.

Why is this important for your organisation?

As companies, governments and various stakeholders seek to explore opportunities on the African continent, it is vital to be cognisant of terrorism financing issues and guard against them. Enhanced due diligence must be applied in high-risk situations. African regulators and policymakers must ensure the right systems are in place to protect their financial system from money laundering, terrorist financing, and proliferation financing (ML/TF/PF) risks. Private sector entities should raise awareness of ML/TF/PF risk amongst their staff, especially those within procurement, to reduce their organisation’s exposure.

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