Namibia agrees to self-correct FATF deficiencies

Bryan Eiseb, Director of the Financial Intelligence Centre tells Observer Money about the next step of action Namibia will take following the greylisting of the country by the Financial Action Task Force’s (FATF).

Observer Money (OM): What does ‘increasing monitoring’ under Financial Action Task Force’s (FATF)’ mean for Namibia in practical terms?

Bryan Eiseb (BE): Increase monitoring by the FATF (The Financial Action Task Force) is known as a public statement, which is generic to all and any jurisdictions that the FATF requires to take certain actions to address deficiencies it has identified during a mutual evaluation process. It simply means that the jurisdiction, in this case, Namibia, has agreed to self-correct the deficiencies with the timelines of the action plan. The action plan contains the list of deficiencies and the timelines in which they have to be corrected. The FATF by virtue of the public statement does not require other jurisdictions or entities dealing with Namibia to take or consider any action against Namibia, so generally it is expected that business will continue its normal course. It is not a sanction, but merely a message that the country has some strategic deficiencies in its AML/CFT framework and is working with the FATF and the FATF regional style body (in this case Eastern and Southern Africa Anti Money Laundering Group – E
SAAMLG) to address those deficiencies.

OM: How will Namibian institutions be monitored compared to before?

BE: As mentioned earlier and based on the experiences of other countries added to jurisdictions under enhanced monitoring, our neighboring countries with whom Namibia enjoys strong financial sector attachments will not foresee any significant changes in the way the market may respond to the greylisting.

OM: The FATF found Namibia wanting in AML/CFT/CPF effectiveness in six of the 11 immediate outcomes. When will this be addressed by Namibia and when does FAFT expect to see Namibia meet these demands?

BE: During the Mutual Evaluation process conducted under the auspices of the Eastern and Southern Africa Anti Money Laundering Group (ESAAMLG) in 2022, 72 issues were raised that Namibia had to address in 12 months which ended in October 2023. During these 12 months, Namibia addressed 59 of those issues successfully, these included technical compliance matters such as the passing of new laws, four of them, and amending nine laws amongst others. This left Namibia with 13 items which is related to effectiveness. Namibia had to report to the FAFT joint group on these matters. While we attempted to address these issues, the National Coordination Committee which comprises of various offices, agencies and ministries had to present the post observation period (12 months after the mutual evaluation period) at the FATF. The FATF was not convinced that Namibia made notable and tangible progress on these matters, and this resulted in our country being added to the list of jurisdictions under enhanced monitoring.

Countries that are being placed on the list of jurisdictions under enhanced monitoring are usually given 24 months to address the issues. Jurisdictions that were placed on the list were able to exit it in periods ranging from 12-36 months however from historic data, 18 months seems to be the norm. Despite these

trends, the Namibian government has optimally made a commitment to itself to exit the list expeditiously. Namibia will now have to report at regular intervals at the FATF plenary meeting on the progress it made. If Namibia has reported significant progress, FATF may sanction an onsite assessment after which it will consider the report and decide to maintain or remove Namibia from the list.

OM: When will Namibia start working on the action plan that was prescribed by FATF.

BE: There is constituted a national task team with the FIC as the coordination agency. The task team has commenced its work amongst others we have engaged international technical assistance partners, we have convened as a task team and comprehensively analyzed the 13 action items, and all agencies now need to commence with implementing and tracking the implementation.

OM: What has been the impact so far since Namibia was blacklisted?

BE: Namibia has not been blacklisted but was added to the list of jurisdictions under enhanced monitoring, or so-called grey listing. Backlisting refers to uncooperative jurisdictions and this may result in real or tangible sanctions being imposed by FATF member countries.

OM: Do we know how much meeting FATF demands will cost Namibia?

BE: The process of dealing with the action plan as directed by FATF cannot necessarily be quantified ab initio (from the beginning), needless to state that the process of self-correction is resource intensive, this implies that as a country we will need to adequately resource institutions in terms of human capacity, systems and process. We will need to enhance cooperation between law enforcement agencies and show the effectiveness of our laws, thus it is not a mechanical quantification but rather a display of technical compliance and effectiveness of our country to adequately deal with money laundering, terrorist financing and proliferation financing.

OM: Is there anything else that you wish to add?

BE: We would like to give assurance to the Namibian nation that the Government of the Republic of Namibia affirm its unwavering commitment to the timely completion of the outstanding 13 action items. During the recent post-observation period, Namibia has been acknowledged for its commendable efforts in addressing 59 of the 72 identified action items, a testament to our dedication and progress in these matters. It is also noteworthy that many international organisations and countries have extended their support to Namibia, recognising our efforts and collaborating with us in overcoming the remaining challenges. This support has been forthcoming despite Namibia’s inclusion in the list of jurisdictions under enhanced monitoring. The government is fully engaged and continues to prioritise these action items, demonstrating our ongoing commitment to not only meet but exceed the expectations set forth by international standards. We are confident in our ability to complete the remaining tasks with diligence and effic
iency, further solidifying Namibia’s standing on the global stage.

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