West Africa: preventing terrorist abuse of informal funds transfers
On average, less than 12% of the population of any West African country has a bank account. Funds are transferred outside the formal financial sector via telecom companies, transport companies, bus services or other businesses.
In an effort to help States prevent the diversion of these transfers to terrorist use, CTED facilitated a workshop for West African States on "Effective monitoring of alternative remittances to prevent terrorist financing abuse", held in Dakar, Senegal from 17 to 19 March 2014.
Alternative remittances are often cheaper and faster than regular financial transfers and the only way to send funds to remote areas. They are also a vital lifeline for communities that depend on support from relatives abroad.
International standards require States to perform a national risk assessment of their financial sectors and to register and supervise all money remitters. Because most financial transfers in the region are not monitored by supervisory authorities, they are vulnerable to money-laundering and terrorist financing.
The workshop was attended by financial intelligence units, regulatory agencies and private-sector entities of Burkina Faso, Chad, Ghana, Niger, Nigeria, Mali, Mauritania and Senegal, as well as by relevant regional and international organizations and other UN bodies.
The workshop followed a similar event held recently for the Horn of Africa region.
Workshop participants identified existing remittance channels and discussed ways to bring the unregulated informal sector into to the formal sector and promote financial inclusion.
Experts from Afghanistan, Namibia and the Philippines shared their experiences in monitoring alternative remittances and proposed ways to reduce the risk of abuse.
The workshop enabled participants to share experiences with counterparts in other States of the region and to learn from private-sector self-regulatory initiatives, such as the Somali Money Services Association (SOMSA).
The workshop was held with the support of Germany and the Netherlands and in cooperation with the Intergovernmental Action Group against Money Laundering in West Africa (GIABA) and the Global Center on Cooperative Security.
GIABA, the region's FATF-style body, pledged to continue to promote dialogue between its member States and the private sector; support the drafting of regulations that comply with international standards; and help States of the region to conduct national risk assessments.