Saturday, December 4, 2021

AML ranks Botswana lowest risk of money laundering

Botswana’s efforts aimed at addressing issues relating to money laundering seem to be bearing fruit as it has emerged as one of the countries at the lowest risk of money laundering. 

This is according to the latest Basel anti-Money Laundering (AML) Index 2021 report by the Swiss based Basel Institute on governance.

Botswana which is already on the European Union (EU)’s grey list was also placed among the list of high risk countries for money laundering and terrorist financing by the United Kingdom (UK) in April this year.

But the southern African nation seems to be getting its act together as  the latest report by Basel institute comes on the heels of  Financial Action Task Force(FATF)‘s updated assessment in July this year which noted progress in the country’s money laundering structures that the country has put in place.

According to the latest report by Basel Institute which assessed a number of countries from various regions across the world, Botswana and Ghana have the lowest least risk in the Sub Saharan region.

The report described the sub-Sahara as the region which “has the highest overall risk score of all regions” in the world. 

“Although data is lacking, of particular concern is the quality of  Anti-Money Laundering and Counter Terrorism Financing (AML / CFT) frameworks, where some jurisdictions (Democratic Republic of the Congo and Mauritania) have a risk score over 8 out of 10 (which indicate a high risk),” the report says.

It further states: “Apart from Mauritius and Botswana, most assessed jurisdictions face high risks of bribery/corruption and financial transparency/standards.”  Botswana was ranked number 70 out of the 110 countries assessed in the report with a score of 4. 87 which indicates that it is at low risk as far as money laundering and terrorism financing is concerned.

The report says these issues need to be addressed through broader long-term policies, although more effective Money Laundering/Terrorism Financing (ML / TF) compliance could contribute to efforts to detect and prevent corruption.

“The wide distribution of scores across the region (sub-Sahara) may in part be due to the presence of several developing economies with high levels of corruption and political/economic instability. More coordinated regional policies and capacity building could help to bring weaker jurisdictions up to standard,” it says.

The report says Tanzania and Mozambique improved their scores following a fourth-round FATF evaluation, bucking the trend adding that Zimbabwe’s risk score increased since 2020, due mostly to higher risks of human trafficking.

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