Monrovia – The Chief Executive Officer of the Financial Intelligence Unit of Liberia (FIU) has been outlining reasons why Liberia was downgraded by GIABA.
GIABA is the Inter-Governmental Action Group against Money Laundering and Terrorist Financing in West Africa, which is a specialized institution of ECOWAS responsible for facilitating the adoption and implementation of AML/CFT measures.
Addressing a Ministry of Information, Cultural Affairs and Tourism (MICAT) press briefing, Alex Cuffy said Liberia has not completed, passed, approved and published into handbills a draft Anti-Terrorism Act of 2016.
Cuffy also disclosed that Liberia doesn’t properly supervise reporting entities for money laundering and terrorist financing.
He pointed to the lack of an Intellectual Property Act and inappropriate structures for the FIU to qualify for membership to the EGMONT Group of FIUs.
Cuffy, however, hailed the Legislature’s passage of the Firearm and Ammunition Act of Liberia 2015 in March and hopes for a speedy approval and printing into handbills.
In addition, Liberia was warned to intensify efforts to facilitate money-laundering convictions by GIABA but Cuffy thanked President Ellen Johnson-Sirleaf for her swift interventions.
“Our President acted swiftly by lending her support to the FIU and ensuring that several regulations were approved and published. And I admired her resolve because when I brought this issue to her attention, she was very proactive.
“She is very concerned as well as other members of the government have remained concerned about this [situation] because at this time of our economic situation to be in this state—to be downgraded by a world body—is not a good thing.
“What happens is we are then reported to the Financial Action Task Force (FATF) in Paris, France. And if we don’t take steps to move from the pressure of reporting every six months, then a public statement is issued by FATF.
“A public statement is like Ebola is in your country and nobody wants to go there. It is like America or Great Britain telling its citizens and investors not to go to a particular country.
“A public statement means a country is allowing its financial systems to be abused by criminals by not putting in adequate measures to protect its financial systems as part of the worldwide effort to combat money laundering and terrorist financing,” Cuffy effortlessly explained on May 17.
Cuffy, who was the only Liberian to work with the Governance and Economic Management Assistance Program (GEMAP-Liberia), also called on the Legislature to compliment President Sirleaf’s efforts by enacting some key legislation.
“One of the key things is terrorism right now. We are still working on our laws on terrorism. That is one of the cardinal reasons why we were downgraded to the six-month reporting. Do I like it or do we like it as a country? No, because it has consequences.
“It can impact on our economy because the work of the FIU also engenders economic growth. And if it [FIU] doesn’t do its work good, it can also have reputational risk on our country. And that reputational risk means that people outside maybe a little careful [in coming to our country],” Cuffy added.
Cuffy then announced that the FIU, with the approval of President Sirleaf, has issued four regulations to enhance the fight against money laundering and terrorist financing.
The regulations include regulation dealing with cross-border transportation of currency and bearer negotiable instrument; regulation for further distribution and action on the United Nations list of terrorists and terrorist groups; regulation on currency transaction reporting for financial institutions and regulation on suspicious transaction reporting for financial institutions.
Cuffy said the regulations were issued in response to GIABA decision to downgrade Liberia for failing to meet some of the requirements of FATF as was stipulated in the fifth follow-up report during a recent visit by a high level team from GIABA.
The regulation dealing with cross-border transportation of currency and bearer negotiable instrument requires all persons entering or existing Liberia by land, sea or air to declare currency or instrument above the threshold of US$10,000 or its equivalent in Liberian dollars.
Under the regulation, persons are obligated to provide customs officers with all relevant information or documentation to determine whether resources above the threshold being transported across the border are legitimate in origin and or method of acquisition.
The regulation for further distribution and action on the UN’s list of terrorists and terrorist groups seeks to implement the UN Security Council Resolution (UNSCR) 1267 & 1373, and specifically as it relates to the further distribution of and action on the UN’s list of terrorists and terrorist groups.
It requires reporting, regulatory and other entities to inform the FIU upon receipt of the list of any customer and or potential customer on the list.
Financial institutions and other entities must also screen new and potential customers and inform the FIU about any transaction or attempted transaction by a name identified on the list.
The regulation on currency transaction reporting (CTR) for financial institutions requires the mandatory filing of cash transactions reports by financial institutions to the FIU based on the threshold of US$5,000 and above or L$100,000 (one hundred thousand Liberian dollars) for individuals or US$10,000 and above or L$1,000,000 (one million Liberian dollars) and above for businesses and institutions.
The regulation on suspicious transaction reporting (STR) for financial institutions requires the mandatory filling of suspicious transaction reports by financial institutions to the FIU where there exist any reasonable grounds including facts and circumstances that indicates a transaction maybe unusual or suspicious.
It is also required that financial institutions are exact or certain that the transaction is definitely connected to criminal activity.
The regulations on CTR and STR are to be implemented by financial institutions and regulated by the Central Bank of Liberia.
The FIU was created by an act of the legislature in 2013 to serve as the central national agency for receiving, requesting and conducting preliminary investigation and analyzing and disseminating information concerning suspected proceeds of crime and terrorist property.
The FIU, which is a member of GIABA, has requested the public to fully adhere to these regulations as it is committed to ensuring its implementation to the letter “to protect Liberia’s financial systems from abuse of financial crimes for the enhancement of national, regional and global peace and economic stability”.
Danesius Marteh, [email protected]
