Business Reporter
THE Minister of Finance and Public Enterprises, Iipumbu Shiimi, has said that Namibia has made significant strides in trying to meet international standards set forth against money laundering, with the country addressing 59 out of 72 action items.
He, however, added that due to the fact that the country has not addressed 13 remaining challenges, it may face blacklisting and increased monitoring.
Since December 2022, Namibia has been diligently working towards meeting international standards set forth by the Eastern and Southern African Anti-Money Laundering Group (ESAAMLG) and the Financial Action Task Force (FATF).
The global task force serves as a watchdog for money laundering and terrorist financing activities worldwide. In the past, the task force in its Mutual Evaluation Report (MER) raised concern regarding increasing criminal cases linked to financial proceeds, damaging the country’s financial and legal systems’ credibility.
These include the Fishrot scandal, the Value-Added Tax (VAT) scam, and Namibia SME Bank fraud. The report highlighted that most of the proceeds were laundered through banks, unit trust schemes, and asset management related financial services. The MER found that some companies, service providers, lawyers, and real estate agents were found to have a high money laundering vulnerability in the designated non-financial businesses and professions sector and were also central to the high-profile cases.
Shiimi explained that a comprehensive mutual evaluation conducted over two years culminated in the adoption of the Namibia Mutual Evaluation Report by the ESAAMLG Council of Ministers on 2 September 2022. “Following the evaluation, Namibia’s financial sector assets exceeding five billion American Dollars (USD) triggered a review by the FATF’s International Cooperation Review Group (ICRG). Over a 12-month observation period ending in October 2023, Namibia undertook crucial steps to address 72 key recommended actions outlined in the Mutual Evaluation Report,” the finance minister explained.
He added that in response, Namibia passed four new laws and amended nine existing ones by August 2023.
“Additionally, a dedicated Project Team was formed to ensure the effective implementation of these legal and policy frameworks, reporting regularly to relevant authorities and stakeholders. Namibia submitted its final progress report to the FATF ICRG towards the end of 2023. Consequently, the Namibian team, which I led, engaged with the FATF ICRG joint group in January 2024 in Abu Dhabi. During this engagement, Namibia showcased its commitment to addressing the evaluation findings. Preliminary indications reveal that Namibia passed the technical compliance test and made progress in five out of the 11 immediate outcomes on the effectiveness test. Notably, 59 out of 72 action items were successfully addressed, with only 13 remaining,” Shiimi said.
He added that as a result of the few remaining action items, Namibia may be included on the list of jurisdictions under increased monitoring. “This will, however, only be confirmed once the FATF ICRG joint group meeting, which will take place in the next few days, is concluded. The FATF ICRG will collaborate with Namibia to finalize an Action Plan focusing on these remaining items,” the minister concluded.
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