A blitz by Bank of Namibia (BoN) since 2010 when the Financial Intelligence Act was introduced resulted in 997 cases of suspicious transactions reported (STR ) money laundering being investigated in Namibia.
Information at hand show that the highest number of suspicious case of money laundering transactions were recorded in 2013 amounting to 42.43% of the total number of transactions recorded.
In real terms the central bank handled 423 out of the total 997 in that year alone.
The lowest suspicious cases of money laundering recorded were in 2010, totalling 8.83% of the total number of cases reported.
Latest data also revealed that the from 2011 to 2013, the number of reported suspicious cases of money laundering kept increasing.
148 cases of suspicious money laundering reported in 2011 and increased to 249 in 2012. The number of suspicious cases increased by 174 to 423 in 2013 from 249 cases recorded in 2012.
The most common sources of STR for the period under review were either Internally generated, Public members, Financial service providers, Asset managers, Supervisory authorities, Legal practitioners, Government ministries, Accounting firms, Money remitters, Insurance, Motor vehicle dealers, Casino/gambling house, and Law Enforcement Units.
The Director of Strategic Communications and Financial Sector Development, Ndangi Katoma, said the Financial Intelligence Act (FIA), 2012 (Act No. 13 of 2012) which repealed the Financial Intelligence Act 2007 provided, among other things, the need establishment of the Financial Intelligence Centre (FIC).
“FIC is the national centre responsible for collecting, requesting, receiving, and analysing suspicious transactions and activity reports, which may relate to money laundering or the financing of terrorism. However, the FIC is not in a position to answer question on how much was lost to the economy as this kind of assessment has not been done in Namibia as yet,” said Katoma.
Katoma added that some of the predicate offences for Money Laundering are Tax Evasion, illegal diamond smuggling; illegal smuggling in drugs; fraud; robbery; extortion and theft.
“However, The Prevention of Organised Crime Act 29 of 2004 (POCA) clearly defines the offences relating to Money Laundering. POCA in its Chapter 3, Sections 3 to 6 describes those activities, which constitute Money Laundering as disguising unlawful origin of property, assisting another to benefit from proceeds of unlawful activities, acquisition, possession, or use of proceeds of unlawful activities,” he added.
Katoma noted that the negative economic effects of money laundering on economic development are almost the same throughout the world, adding, it is clear that money laundering damages the financial-sector institutions that are critical to economic growth, reduces productivity in the economy’s real sector by diverting resources and encouraging crime and corruption, which slow economic growth.
“Moreover, criminal organisations can transform productive enterprises into sterile investments by operating them for the purposes of laundering illicit proceeds rather than as profit-maximising enterprises responsive to consumer demand and worthy of legitimate investment capital. Money Laundering also drains the already scarce resources and erodes financial institutions themselves,” noted Katoma.
There are two laws that deal with Money Laundering in Namibia, namely the Financial Intelligence Act 2012 (FIA) and Prevention of Organized Crime Act 2004 (POCA) and as stated earlier, FIA provides for the establishment of the Financial Intelligence Centre as the national centre with clear responsibilities highlighted.
Katoma said POCA introduces measures to combat organised crime, money laundering, and criminal gang activities to prohibit certain racketeering activities.
He added that POCA also aims to implement the prohibition of money laundering and for an obligation to report certain information, to criminalise certain activities associated with gangs.
“It also provides for the recovery of the proceeds of unlawful activities and to provide for the forfeiture of assets that have been used to commit an offence or assets that are the proceeds of unlawful activities,” said Katoma.
Katoma said that Accountable Institutions and Supervisory Bodies, are required to put in place internal controls and monitoring systems to prevent and detect money Laundering and report such illegal activities to the Financial Intelligence Centre.
“Lastly, the acts require any person who knows or ought reasonably to have known that another person has obtained the proceeds of unlawful activities as well as any person who carries on a business or is in charge of, or manages a business undertaking or who is employed by a business undertaking and who suspects or ought to have reasonably suspected and come into possession of proceeds of unlawful activities should report such unlawful activities to the Financial Intelligence Centre,” said Katoma.