Ghana has been urged to strengthen institutions and master the political will to ensure that the country does not become a safe haven for money laundering activities, as its offshore banking ambitions ‘risk being soft touch magnet for flood of dirty money’.
Speaking at a public lecture in Accra yesterday, on the theme “Protecting Ghana and Ghana’s Emerging Financial Offshore Centre from Money Laundering,” John Hardy QC, a UK Attorney touched on the global effect of money laundering and its attendant effect on Ghana, if pragmatic measures were not put in place to minimize to lowest ebb or completely eradicate its occurrence.
The UK Attorney cautioned that given Ghana’s off-shore ambitions, it is clearly vital that effective regulation, transparency and external monitoring are put in place, if its off-shore centre is not going to be at risk of being a soft touch magnet for a flood of dirty money.
He noted that the issue of money laundering has become an international headache and commended Ghana’s efforts through legislations such as the Anti-Money Laundering Act 2007 (in force from 22 January 2008), Banking Amendment Act 2007 and others in the country’s bid to prevent the transfer of criminal funds in financial systems and also put proper alert mechanisms in place. “If the criminal fraternity cannot profit from their crimes, so the theory goes, they will have much less motive to commit them.” he emphasized.
According to him, because money laundering is an international activity, it can only be restrained and restricted if anti-money laundering is conducted on the basis of international standards, internationally monitored and international co-operation measures which are empowered internationally and simplified so as to work expeditiously and without bureaucratic hindrance.
“One of the principal difficulties in translating international declarations of principle and intent into effective domestic legislation was the tension between the need to promote transparency in banking transactions on the one hand and, on the other, the principle of client confidentiality which bound the banks”, he noted.
According to him the 1990 Recommendation of the Financial Action task Force’s (FATF), recommendations stated that “Countries should ensure that financial institution secrecy laws do not inhibit implementation of the FATF Recommendations.” It also stated among others that there must be the necessary legislation – to criminalise money laundering and secondly, the legislation must also provide for systems and resources to enforce that law.
“But mere provision is not enough. There must also be genuine and deep-seated political will to enforce the legislation. That will is reflected in the provision of resources and the effectiveness of the court as institutions of enforcement. Hence regulators, investigators and judges all have their part to play. So, too, do compliance officers and those charged with supervising the ethics of the bank and other financial industries.”
He noted that each state needs to utilise its own legislative and enforcement apparatus to make conditions within its borders as unfriendly as possible for money laundering.
These notwithstanding, he said it was worth noting “the creation and resourcing of agencies capable of investigating large amounts of complicated transactions without assistance from the banks and other institutions, that would have involved the establishment of huge, cumbersome, bureaucratic and ineffective organisations at disproportionate expense to the public purse.
Equally, the proscription of money laundering through legislation, without the establishment of effective means of enforcement, would have rendered the legislation toothless and futile.” In the case of Ghana, he noted that “what appears to be a problem in Ghana is a combination of the slow rate of progress, a sense of dithering and a lack of real political will.
That lack of real political will he said “is not confined to one party”. Adding that “antimony laundering should be thrust forward to the top of governmental agenda on non-partisan basis. If that can be done here, Ghana will move forward”.