Botswana is making concerted efforts with a view of implementing the action plan required by the Financial Action Task Force (FATF) to address deficiencies in anti-money laundering and combating the financing of terrorism.
This is in reaction to a decision by the European Union (EU) to include Botswana in the list of high risk third countries effective Oct. 1, 2020 on account of having strategic deficiencies in its anti-money laundering and combating the financing of terrorism regime.
“Concerted efforts are ongoing to implement the FATF required action plan to address the identified deficiencies,” Seamogano Mosanako, head of communications and information services at the Bank of Botswana, said in a statement released Thursday after the country’s Financial Stability Council (FSC) meeting in Gaborone, Botswana’s capital city.
Officially launched in Feb. 2019 for the purpose of sharing and cooperating in the implementation of a macro-prudential policy framework for Botswana, FSC comprises senior officials of the country’s Ministry of Finance and Economic Development, Bank of Botswana and Non-Bank Financial Institutions Regulatory Authority.
The implication of the listing of Botswana as a high risk third country is that EU banks and non-bank financial institutions are required to carry out enhanced customer due diligence, that is, requiring more information on financial transactions originating from Botswana clients for as long as Botswana remains grey-listed by FATF, she said.
“This has got the potential to delay the processing of international payments including for imports and offshore placements by local entities,” said Mosanako.
Botswana was early this year added to the list of 22 countries that pose financial risks to the EU due to anti-money laundering and combating financing terrorism deficiencies alongside Ghana, Mauritius and Zimbabwe.
Thapelo Matsheka, the southern African country’s minister of finance and economic development, late last month said Botswana is working with technical assistance providers to improve its anti-money laundering and countering the financing of terrorism.