Financial Intelligence Act finally in operation

THE Bank of Namibia (BoN) yesterday announced that the Financial Intelligence Act (FIA) of 2007 will come into force tomorrow.
BoN governor Tom Alweendo said the act’s implementation had been postponed due to ‘legislative delays’.

The Act builds on the Prevention of Organised Crime Act of 2004, which is the main law criminalising money laundering in Namibia. The FIA puts in place preventive measures to combat money laundering and will be administered through the newly established Financial Intelligence Centre (FIC) at the BoN.The Act has implications for a wide range of businesses, especially for the financial services industry.It makes it mandatory for ‘financial institutions, non-banking financial institutions and designated non-financial businesses…to report Suspicious Transaction Reports (STRs) to the Financial Intelligence Centre,’ according to an official statement. The centre will then pass on these reports to law enforcement agencies where necessary. It also forces these so-called ‘accountable institutions’ to keep profiles of their customers (called ‘know your customer policy’) and adjust their customer acceptance and customer due diligence procedures. Money laundering is the act of engaging in legal transactions with money gotten through criminal activities.For example, buying a car with the proceeds of selling drugs would constitute money laundering, as the ‘dirty’ money has been turned into a legal purchase. Clive Scott from the United Nations Office on Drugs and Crime (UNODC) said in a recent article on the subject that ‘money laundering allows criminals to benefit from the proceeds of their crimes’.Scott said cracking down on money laundering can have a potentially huge impact on crime, because it strikes criminals where it hurts: their bottom line. Alweendo said money laundering ‘can lead to the accumulation of economic power to organised crime’ which ‘could spell disaster for stability and the rule of law’.He said globalisation had made the impact of money laundering more severe and therefore ‘requires a global response’. Money laundering could even play havoc with a country’s monetary policy as it changed the cash demands of an economy, the governor said. As part of the Act’s implementation, the BoN is launching an educational campaign to inform the public and accountable institutions of the new law. The campaign will include advertisements on national radio, television and in the print media.