The European Union (EU) insists that it found it fit to include Botswana in a draft list of jurisdictions that pose a high risk of money laundering.
Responding to Sunday Standard queries, Head of the Political, Press and Information Section for the Delegation of the European Union of Botswana and SADC, Katrin Hageman maintained that Botswana has been identified in October 2018 as one of the countries presenting strategic deficiencies by the Financial Action Task Force.
According to Hageman, the FATF acknowledges that Botswana has committed at the highest level to address the deficiencies and has adopted consequently an action plan to address the deficiencies.
“The Authorities of Botswana have acknowledged the deficiencies and are taking strong measures to comply with the action plan as agreed. The EU has adopted criteria to identify high risk countries with Anti-Money Laundering/Counter Terrorist Financing (AML/CFT) deficiencies,” she noted.
She said the EU assessment takes into consideration the relevant work which is undertaken in this area, notably by the FATF.
“The EU is working with the Botswana authorities to address deficiencies identified by the FATF and in the EU’s assessment of Botswana’s AML/CTF regime,” Hageman revealed.
On one hand, Botswana insists that it be removed from the list because she has addressed some of the deficiencies in combating money laundering to meet international standards by amending its legislations. The southern African nation also argue that despite such efforts the EU went ahead and included it in the list.
Commenting on that, Hageman said the action plan adopted by Botswana includes measures to improve the legislative framework and measures to ensure the new laws are effectively implemented.
“The progress will be monitored by the FATF and the EU in the months to come. The EU with other development partners is working with the authorities to identify areas where the authorities’ capacities need to be strengthened to ensure the implementation of the new AML/CTF regime,” she said. The EU diplomat added that the EU will also assist the authorities regarding the different steps to be delisted from the EU listing.
Botswana also accuses the EU of blacklisting her based on the findings of the assessors from Eastern and Southern Africa Anti Money Laundering Group who found that Botswana had strategic deficiencies in their anti-money laundering and countering terrorist financing regime.
The assessors reviewed Botswana’s Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT) legislations and institutional framework against the Financial Action Task Force (FATF) recommendations and the provisions of other relevant international conventions. Therefore Botswana insists “The European Union (EU) has adopted the findings of the FATF.”
Hageman’s response to that is that the EU methodology is aligned on the FATF criteria but is extended to additional criteria. Any Anti-Money Laundering/Counter Terrorist Financing (AML/CFT) threat posed to the international system also represents a threat to the financial system of the European Union.
“Therefore the EU list cannot disregard the assessment undertaken by the FATF and agreed internationally. The European Commission, as member of the FATF, is fully associated with and committed to the work carried out in the context of the FATF,” she said.
According to the criteria used to blacklist countries include weak sanctions against money laundering and terrorism financing, insufficient cooperation with the EU on the matter and lack of transparency about the beneficial owners of companies and trusts. But the Botswana Government says it “does not agree that there exist any issues related to cooperation with the EU.”
On this argument, Hageman said the EU assessment is based on a methodology which has been adopted by the European Council.
“ The methodology is publicly available. One of the criteria refers to the availability of accurate and timely information of the beneficial ownership of legal persons and arrangements to the competent authorities,” she said. She further explained that in 2003, the FATF became the first international body to set international standards on beneficial ownership which focused on legal requirements for financial institutions and other gatekeepers to collect and verify information on the ownership of legal persons and arrangements.
Hageman said the beneficial ownership information is very important in the fight against money laundering.
“The Botswana government is presently working to improve beneficial ownership information as one of the key measures to address the deficiencies,” she said. Hageman said Botswana has committed at the highest level to address the identified deficiencies and the relevant institutions are working together and with development partners including the EU to implement the agreed measures.
“The cooperation between the Botswana authorities and the development partners including the EU is very good,” she said.