Money launderers expected to take advantage of Ghana’s oil boom economy – FIC

RemittancesGhana’s recent economic growth fueled by oil production will not be spared the activities of money laundering and illicit financial transactions, the Ghana Financial Intelligence Centre (FIC) has alerted.

The Ghanaian economy is expanding and more investors are coming. The International Monetary Fund (IMF) projected the economy grew at least 13.5% in 2011.

The government of Ghana through the Ministry of Finance and Economic Planning on September 15, 2011 issued a statement saying the economy will grow 14.1% in 2011. The World Bank expects Ghana’s economy will expand by 20% in 2011 with the Standard Bank also projecting a 16.3% growth for 2011.

Acting Chief Executive Officer (CEO) of the FIC, Mr Samuel Thompson Essel says once Ghana’s economy is growing due to the oil, criminals will also enter the country.

“Once we have the economy growing, we should expect that criminals (money launders) will also enter the country…its very obvious,” Mr Thompson Essel told reporters in Accra today January 4, 2011  when the Bank of Ghana (BoG) launched the guidelines on Anti-Money Laundering and the Combating of the Financing of Terrorism (AML/CFT) for Banks and Non-Bank Financial Institutions.

As Ghana experiences a booming economy, Mr Essel said “we should expect a correspondent increase of criminals creeping into the system.”

Ghana became an oil-producer December 15, 2010.

But Mr Essel is confident that the FIC, set up in 2010 in accordance with Section 4 Act 749, will provide intelligence report on suspicious transactions to the law enforcement agencies to conduct further investigations.

“The intelligence that we give to the law enforcement agencies is not to be used as evidence in court but we are only prompting them this is what we have found to be a bit suspicious,” he said.

An official at the United Nations Office on Drugs and Crime (UNODC) says more than $1 trillion is the amount of money laundered yearly in recent times into the global financial market.

The official said once criminal money has entered the global and financial markets, it becomes much harder to trace its origins.

“More than one trillion dollars: this is the staggering amount of money probably laundered annually in recent years,” said Pierre Lapaque, Head of organized crime and money-laundering unit at UNODC in an interview with the UN radio August 11, 2011.

In 1998, the International Monetary Fund estimated that the amount of money laundered is the equivalent of between 2% and 5% of global gross domestic product (GDP).

Despite measures put in place to combat financial crimes such as the training of both police and custom officials on client identification and development of a detection system, Mr Lapaque notes that there will always be money-laundering. “The most we can do is to restrict the flow and staunch it as early as possible.”

According to him, the menace will be curbed if the criminal markets are tackled to make it unattractive since crime is lucrative and money-launderers  are using state-of the-art technology, making the fight more difficult, and requiring governments to conduct ongoing risk assessments.

“In the long term, criminal groups are not important, what really matters is to tackle the criminal markets to make them less attractive. Focusing solely on law enforcement is short-sighted. Imprisoned criminals will be immediately replaced by others, and their activities will continue as long as crime is lucrative.”

Last year 2011, the Danquah Institute (DI) alerted the Ghana government on illegal international money transfers after it conducted a research in three European countries indicating that more than 60% of total remittances sent to Ghana in 2010 were through illegal money transfer routes.

The group stated that these remittances from illegal channels could be between $1.2 billion and $2.12 billion, including laundered money from crime proceeds.

Nana Attobrah, Head of Research at the Danquah Institute said the research was conducted in Germany, United Kingdom (UK) and the Netherlands, Ghana’s three largest European remittance corridors.

Countries offering offshore banking are perceived to be used as a hub for money laundering.

This perception at one time forced the Bank of Ghana (BoG) to convert Barclays Bank’s license to operate offshore banking into a regular one.

“At a time that Ghana was gaining a reputation for laundry, we did not want to confirm this misperception”, Mr Kwesi Amissah-Arthur, governor of BoG said during a Monetary Policy Committee meeting on February 18, 2011.

Mr Amissah-Arthur also cited lack of regulations to guide the offshore operation even though the Act for offshore banking has been passed.

But Parliament on Thursday March 24, 2011 adopted a Legislative Instrument (LI) to regulate the Anti-Money Laundering Act 2008 (Act 749) enacted to track criminals and financiers of terrorist activities. The Ghana News Agency says a report presented by Mr Kwame Osei-Prempeh, Chairman of the Committee on Subsidiary Legislation, stated that appropriate provisions were made in the instrument to augment the efforts of the security agencies in combating crime and corruption.

He said the application of the legal framework would help to prevent criminals and terrorists from operating in the country.

By Ekow Quandzie

1 Comment
  1. Nashir says

    I think money laundering law should be applied to money launderers. Then economy increases.

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