Why Cameroon must combat terrorism, money laundering.

Cameroon is one of three countries in the world that has been blamed for not doing enough to combat money laundering and the financing of terrorism.

A report published by the Financial Action Task Force against Money Laundering, FATF, has placed Cameroon, Vietnam and Croatia on the "gray list", which implies that the countries "must strengthen monitoring measures to combat money laundering and the financing of terrorism".

FATF is a global inter-governmental body, which promotes policies and sets international standards relating to the combating of money laundering, terrorism financing, and the financing of the proliferation of weapons of mass destruction. 

At the end of the organisation's plenary session in Paris last Friday, it noted that "Cameroon must apply an action plan in order to eliminate the strategic defects identified within the appropriate timeframes".

No specific timetable has been established for the three countries, which have only been instructed to "implement the plan as soon as possible".

Why does it matter? The most significant implication to a country on a gray list is the reputational damage to the country, as its effectiveness in combating financial crimes like corruption and money-laundering as well as terror financing are deemed to be below international standards. 

The second and related implication arises from consequential action taken with regard to cross-border transactions, particularly possible action taken by foreign banks that provide correspondent banking services. To get on the list implies that a country does not demonstrate that it has an effective framework to protect the financial system from abuse.     

Another key indicator is that a country does not meet all the technical "recommendations in its laws, regulations and other legal instruments to combat money laundering, and the financing of terrorism and proliferation". 

Other measures the organisation recommends include actions covering transparency, preventive and punitive measures. For instance, if corruption is not effectively tackled, money laundering will continue with all its associated atrocities. 

The vice is pervasive in Cameroon and those with illicit wealth are known to have been hiding their ill-gotten money in chains of mansions in Cameroon and abroad, land grabbing and luxury vehicles.

There have been reports of hidden money being burnt when security forces swoop in on suspects. Other reports about money being concealed in ceilings by corrupt officials have been rife in Cameroon, given that banking such huge sums will expose suspects to prosecution.

Government's initiatives to meet international standards include the creation of the National Anti-corruption Commission, CONAC and the National Agency for Financial Investigation known by its French abbreviation as ANIF. The latter was created in May 2005. The objectives of ANIF are the fight against money laundering and financing of terrorism.

Given the transnational nature of crimes related to money laundering and financing of terrorism, ANIF also operates within the framework of an Inter-ministerial Committee put in place by the Minister of Finance and following the authorisation given by the Minister of State, Secretary General of the Presidency of the Republic for the opening of the such negotiations in accordance with the Cooperation Agreements it has with Foreign Financial Intelligence Units, FIU, on the exchange of information and data.

It also operates with the collaboration of banks, microfinance institutions, insurance companies and other regulated institutions. At the regulatory level, these institutions are required to report suspicious transactions to the State's financial intelligence unit, enabling it to commence investigations.

As money laundering is increasingly being carried out through investments in sectors like real estate, ANIF has also included hardware stores in the list of its collaborating agents.

It receives reports of suspicious financial transactions from collaborating institutions, investigates them and subsequently transmits to the competent jurisdiction for prosecution, which may not be carried out.

Nonetheless, ANIF has been making some progress. In 2008, it handled 83 suspected cases of money laundering. The number significantly leaped to 670 in 2018. Latest statistics are not available.

There is no question that illicit financial flows remain a serious problem, given the conflict in the North West and South West Regions as well as the war against Boko Haram in the Far North Region, with tremendous negative impact on the economy.  It is also a global crime affecting both developed and developing countries.

Although in Cameroon, security forces like gendarmes and the police investigate offences, money laundering has proven to be very sophisticated in nature, thereby necessitating the establishment of specialised agencies to investigate such offences.

Creating organisations to fight such heinous crimes is one thing, but their ‘effectiveness’, which is the operating word within the recommendations of the Financial Action Task Force against money laundering of which Cameroon is a member, is a different ball game.

The principal defect in the mission of ANIF, however, is that unlike Nigeria's Economic and Financial Crimes Commission, EFCC, for instance, that has tremendous powers to investigate and directly prosecute offenders, ANIF does not have such powers and only reports to the prosecutors after investigation.

With such deficiencies in fighting corruption, money laundering and the financing of terrorism, Cameroon will have to cleanse its stained international image to entice foreign investors.