Mozambique: State wants to get off laundering, terrorist finance watchdog’s grey list

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Mozambique: State wants to get off laundering, terrorist finance watchdog’s grey list

5:02 CAT | 08 Sep 2023

Image: Domingo

Mozambique has requested the reclassification of another 15 recommendations made by the Financial Action Task Force (FATF) to get off the international “grey list”, with legislation to combat money laundering and terrorist financing, awaiting a final decision on another nine, already concluded.

On the sidelines of the expert meetings of the Council of Ministers of the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG), which is taking place in Kasane, Botswana, the director-general of the Financial Information Office of Mozambique’s ministry of the economy and finance, Aurélio Matável Júnior, said he expected the plenary to approve the reclassification of these nine recommendations made by the Financial Action Task Force (FATF – the global money laundering and terrorist financing watchdog) in 2019.

“This is also a time for exchanging experiences and for complying with the action plan to get off the FATF’s ‘grey list’. Mozambique is not alone on the grey list, there are other countries in southern and eastern Africa on this list and this is an opportunity to exchange experiences and find ways to comply with the recommendations,” he explained, adding that the nine recommendations to be classified were part of a group of 15 initially presented.

The Kasane meeting aims to discuss and approve the mutual evaluation report and assess the progress made by ESAAMLG member states in implementing the FATF’s 40 recommendations, of which Mozambique hopes that “the nine re-evaluated ones will be approved and published” right away.

With this, Aurélio Matável Júnior says there are conditions for Mozambique to get off the “grey list” even before October 2024, the deadline initially set: “Of course I believe it. There is a general commitment on the part of the government and the business community, and I can even say that society in general has woken up and realised that illegal activities must be tackled.”

At this meeting, the Mozambique government also requested the first assessment of the reclassification of a further 15 recommendations, as a result of the recent approval by parliament of legislation to combat money laundering and terrorist financing, in an attempt to resolve “the remaining deficiencies identified in the 2019 assessment”.

“The approval of these laws already puts us in a situation of compliance, of conformity with what the FATF rules or principles are,” assured Aurélio Matável Júnior, emphasising that the country has been showing “improvements” in complying with these obligations since the end of last year.

Between April and October next year, Mozambique will still have to present “evidence” that the new legislation is being applied by the country.

At this meeting of experts in Kasane, Mozambique also presented a study on the typology of money laundering in the trade of products of wild animal origin: “It showed those present how, from poaching, from the slaughter of animals, people use this form to launder money”.

In August, the Mozambican parliament approved, by consensus and at the first reading, legal changes to strengthen the prevention of and fight against money laundering and terrorism.

At issue are proposals to revise the law on preventing and combating money laundering and terrorist financing and the law on preventing and combating terrorism and the proliferation of weapons of mass destruction.

The text of the amendments advocates simplified measures for the identification and verification of money laundering and terrorist financing risks by financial and non-financial entities.

The amendments also introduce specific financial penalties for terrorism.

In justifying the relevance of the two laws, the minister for justice, constitutional and religious affairs, Helena Kida, pointed out the importance of the approved legislation for getting the country off the Financial Action Task Force (FATF) grey list, an instrument that measures the country’s ability to combat this type of crime.

“The consequences could” result in banks reducing or cutting their relations with clients resident in high-risk jurisdictions, investors withdrawing from Mozambique, a reduction in the flow of payments between the country and abroad and a decline in the flow of capital.

Helena Kida stressed that the approval of the laws is part of the two-year “action plan” agreed with the FATF for the “removal of Mozambique from the grey list”.

Source: Lusa