Botswana assess its money laundering, terrorist financing
The government has launched the second National Risk Assessment (NRA) for the country’s financial system.
This is in line with the international standards set by the Financial Action Task Force (FATF), to detect emerging threats to resilience and stability as the nation proactively move away from potential grey listing.
Last year, FATF removed Botswana from its grey list of jurisdictions. FATF is an inter-governmental body mandated to set standards for prevention and combating of money laundering (ML), terrorist financing (TF) and proliferation financing (PF).
Launching the NRA - a 12months exercise that commenced in September and is due next year August - Permanent Secretary to the President, Emmah Peloetletse said the risk assessment will assist us to effectively implement the international standards to avoid finding the country on the grey list again.
“We need no reminder of some of the difficulties our country went through due to grey listing,” Peloetletse said, citing delays in external payments due to enhanced due diligence imposed on all financial transactions.
She also bemoaned that the local economy suffered fewer to no foreign direct investors due to low business confidence, while the country’s trading competitive advantage was negatively affected. Peloetletse implored all stakeholders to double efforts and invest resources on NRA, citing that the local economy can only thrive in an environment free from money laundering and terrorism financing.
The PS said the risk assessment is a precursor to the next Mutual Evaluation which is tentatively set for 2024/25. According to Peloetletse the first NRA was launched on the 4th of March 2015 and the team used data covering a five-year period from 2010 to 2014 and completed the assessment in 2017, mostly led by World Bank staff.
“This time around we believe that we have built enough capacity internally to do the assessment ourselves. However, we wish to acknowledge the World Bank for training our officers on the new NRA modules,” she said.
Peloetletse is confident that the team nominated to undertake the assignment will deliver the report on time and within budget.
“I therefore urge citizens and residents including the AML/CFT fraternity to give support to the team." For the second NRA, the assessment modules have increased from nine to 15.
“Changes and developments in the global financial landscape calls for commensurate interventions. In this regard the FATF is continuously effecting changes in the anti-money laundering standards to ensure that jurisdictions are not caught unaware by the changes but are able to apply risk based supervisory measures.”
Meanwhile NRA Lead Consultant, Susan Mangori said the assessment will put the spotlight on national threats and vulnerabilities and what the country has in place, as mitigation measures.
“It is critical that as we go through this process honesty is important,” Mangori said citing that high vulnerability areas should be exposed so that “we can be able to have prioritised plans.”
Some of the modules the NRA will use include money laundering threats, national vulnerability of legal frameworks, banking vulnerability, insurance sector vulnerability, terrorism financing, financial inclusion product assessment, environmental and natural resources crimes, tax crimes, non-profit organisation risks, virtual assets and virtual assets service providers and the legal persons, legal arrangements and beneficial ownership modules.