Mozambique: Authorities tighten control of cash purchase of cars, houses

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Mozambique: Authorities tighten control of cash purchase of cars, houses

9:55 CAT | 18 Mar 2024

File photo: Lusa

The authorities in Mozambique are going to tighten controls on the purchase of vehicles and property in cash as part of the fight against money laundering and terrorist financing, having carried out around 20 inspections in less than a month.

“We are preparing a revision to the law to include a limit on cash payments, especially when it comes to the payment of high-value property, subject to registration,” Paulo Munguambe, director of Legal Services, Studies and Cooperation at the Mozambican Financial Intelligence Office (GIFiM), told Lusa on Monday.

GIFiM is the supervisory body in Mozambique for fighting money laundering and terrorist financing in the property and car purchase, sale, and resale sectors.

The country currently has no legislation setting limits, only a rule that stipulates that for amounts equal to or greater than 250,000 meticais (€3,590) for cash payments and equal to or greater than 750,000 meticais (€10,765) for electronic transactions and cheques, these transactions must be reported to GIFiM, under the regulation of the Law Establishing the Legal Framework and Measures to Prevent and Combat Money Laundering and Terrorist Financing.

The rule, which doesn’t refer to suspicious operations and only flags them to GIFiM – for possible further assessment and investigation – has been in force since 2014 and was revised in 2023, and is already applied by financial institutions, but not by the automotive and real estate sectors, namely in cash payments.

“What’s missing is some awareness, especially for these non-financial sectors,” explained Paulo Munguambe.

GIFiM is targeting the 21 new car sales outlets, 263 used car sales outlets, and 606 real estate sales outlets operating in the country. Since the end of February, around 20 inspections have already been carried out on the ground.

READ: Mozambique: Sales of cars and properties above 250,000 meticais must be reported to GIFiM – MZNews

In recent months, Mozambique has passed legislation and regulations to tighten controls on financial movements, as part of its strategy to get off the international money laundering grey list.

On 22 October 2022, Mozambique was placed on the so-called grey list of the Financial Action Task Force (FATF) for failing to eliminate deficiencies in the fight against money laundering and terrorist financing.

Source: Lusa