Seychelles submits third progress report to ESAAMLG to showcase the effectiveness of its AML/CFT system |18 February 2020
Seychelles has submitted its third progress report to the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) to highlight the implementation of recommendations aimed at improving the country’s Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) framework.
These recommendations were a result of the country’s second Mutual Evaluation Report (MER) adopted in September 2018.
The progress report demonstrates work done by the law enforcement, regulatory and supervisory authorities since the last report was submitted in July last year. The submission was presented last week after the report was finalised by the National Anti-Money Laundering and Countering the Financing of Terrorism Committee (NAC).
The progress report highlights, among other things, work done to draft two new key pieces of legislations as part of efforts to improve the legislative framework in response to limitations identified in the MER. The new Anti-Money Laundering and Countering the Financing of Terrorism Bill and Beneficial Ownership Bill were gazetted on February 4, 2020. Members of the NAC met with the Bills Committee of the National Assembly on Thursday February 13, 2020, in preparation for the two draft legislations to be tabled before the National Assembly at the beginning of March.
Seychelles will demonstrate its recent efforts and provide further updates to the review panel at the 39th Task Force of Senior Officials’ Meeting (ESAAMLG) to be held from March 29 to April 3, 2020, in Arusha, Tanzania.
The enactment of the two laws is crucial and among several milestones that need to be achieved to address the effectiveness and technical compliance deficiencies highlighted in the MER. This must occur before Seychelles requests a re-rating of the Financial Action Task Force Recommendations (AML/CFT international standards) graded as partially compliant and non-compliant.
The re-rating request shall be submitted in March for consideration at the ESAAMLG’s 20th Council of Ministers meeting in September 2020.
Revision of other laws and regulations, capacity building, the finalisation of a national AML strategy are some of the other priorities that the various law enforcement, regulatory and supervisory authorities, under the leadership of NAC, will be working to address throughout the year.
It must be noted that the improvement of the country’s AML/CFT framework is not only essential to address the recommendations highlighted in the MER, but also to help address emerging challenges with the potential to cause reputational damage.
This includes the recent action taken by France’s recent decision to add Seychelles to its blacklist of tax havens claiming Seychelles has been uncooperative on some issues of fiscal transparency. The inclusion of Seychelles registered companies on the US sanctions list due to links with Iran has also raised alarms.
In an effort to positively address these challenges, the NAC is spearheading efforts to initiate appropriate reforms. At the same time, it is emphasising the need for the various law enforcement authorities, regulatory and supervisory agencies to be more proactive in ensuring compliance of the institutions under their regulatory purview.
The NAC is also increasing its engagement with international partners to assist the country’s efforts to build a more robust AML/CFT regime that is in line with international standards, among which are the US, the World Bank and EU authorities. Seychelles’ public stakeholders have already engaged with their US and other counterparts, recognising the identified threats and risks to the local financial sector, the limitations and challenges of the local authorities to mitigate these threats and are collaborating to assist Seychelles to address the identified challenges.
Contributed by the Central Bank of Seychelles