By:Nghiinomenwa-vali Erastus
To avoid grey-listing and its negative impacts, government has adopted a strategy to rectify some of its regulatory weaknesses.
These are in Anti-Money Laundering and Combating the Financing of Terrorism and Proliferation.
Following the review facilitated by the Financial Action Task Force (FATF), the country’s financial system’s regulatory weakness has been found to pose risk to the international financial system.
These weaknesses were presented in the country’s Mutual Evaluation Report, and the country was given a year to close all findings in order to avoid a targeted FATF review.
A statement released by the country’s financial watchdog, the Financial Intelligence Centre (FIC) this week has, however, indicated that the country adopted a National Action Plan in December 2022.
FIC explained that The Action Plan is to effectively mitigate the risk of a targeted review, and this has been approved by the Namibian Cabinet.
The Action Plan “includes proposed legislative changes and enhanced effectiveness measures by law enforcement agencies to address the findings,”the FIC said.
The proposed legislative changes involve draft amendments and Bills that have been prepared by the relevant national stakeholders.
The first legislative piece to be scrutinized and loopholes to be closed is the Financial Intelligence Act (FIA), 2012.
The proposed change in the FIA is for Section 39 to be replaced by section 21 and the heading to be changed to “Risk Management, Risk Assessment, and Risk-Based AMLCFT/CFP Programmes”.
This has to do with the distinction between Accountable and Reporting Institutions which will be done away with and if there is an identified risk, the monitoring of certain sectors will be prescribed, alternatively, a threshold will be applied for certain sectors.
While Section 33 is proposed to be amended to require that Suspicious Transactions Reports / Suspicious Actions Reports must be filed “promptly” with the FIC.
Namibia’s legislation was found not to adequately discharge this requirement. Section 33 is hence proposed to be amended accordingly.
The consultation on the FIA is currently going on at the Bank of Namibia since 13 February, going until 17 February 2022.
Other eight pieces of legislation that will be amended to fix the highlighted weakness are the Prevention and Combating of Organised Crime Act, 2004; The Prevention and Combating of Terrorist and Proliferation Activities Act, 2014; the Criminal Procedure Act, 1977 (Act No. 51 of 1977); The Police Act, 1990 (Act No. 19 of 1990); and The Extradition Act, 1996 (Act No. 11 of 1996).
Others are The International Cooperation in Criminal Matters Act, 2000; the Companies Act, 2004 (Act No. 28 of 2004); the Close Corporations Act, 1988 (Act No. 26 of 1988); the Banking Institutions Act, (Act 2 of 1998); and the Payment Systems Management Act, (Act 18 of 2003).
The Trust Property Bill will also be scrutinised and necessary amendments made.
The FIC explained that after the country was given a year to rectify the weaknesses it now is going to great lengths to meet the deadlines in order to prevent the country from being greylisted.
“When this occurs, the country’s financial system may suffer reputational harm, affecting foreign direct investments, capital flows, and increasing due diligence costs,” wrote the financial watchdog.
The Financial Watchdog also called upon regulated entities, regulatory and supervisory bodies, civil society, academia, public and private sector role players, and members of the wider public to provide inputs and comments to the proposed amendments and Bills mentioned above.
They have till 17 February 2023 to provide inputs and suggestions.
Email: erastus@thevillager.com.na
