In a bid to promote the culture of compliance, and ahead of a series of inspections of reporting entities, the Financial Intelligence Agency of Liberia (FIA) and the National Lottery Authority (NLA) have agreed to strengthen inter-agency coordination and collaboration through knowledge and information sharing, and enforcement of compliance to Liberia’s AML/CFT legal and regulatory frameworks. The inspections (to be conducted off-site and on-site), will also assess the level of money laundering and terrorist financing (ML/TF) risk associated with each licensed and operating gaming company within Liberia’s territorial jurisdiction.

The impending inspections will span a 4-month period, beginning September to December 2024.

Speaking recently during a joint meeting of the two institutions at the NLA office, FIA Officer-In-Charge, Mohammed A. Nasser, narrated that the core objective of the meeting was to design the scope and type of inspections; and the human, financial and technological resources that are required.

He also disclosed that these inspections will target the banking, Fintech, insurance, and gaming sectors.

He further emphasized the need to pinpoint specific high-risk sectors, institutions, and geographical areas, as well as customers and delivery channels; as captured in the 2021 National Risk Assessment Report, to take mitigating steps.

He mentioned that Liberia’s second round of mutual evaluation report, released and conducted by the Inter-governmental Action Group Against Money Laundering in West Africa (GIABA), identified the lack of regulatory supervision in Liberia’s gaming and other Designated Non-financial Business & Professions (DNFBPs) sectors.

“Section 2.4, Objective 2 of Goal 2 of the National AML/CFT &P Strategy and Action Plan (2022-2025) highlight specific action points – calling for increased off-site and on-off inspections among banks, Non-Bank Financial Institutions (NBFIs), and Designated Non-financial Businesses & Professions (DNFBPs) – to enhance compliance”, Mr. Nasser noted.

He stated that the FIA has designed a risk-based inspection strategy, which will be utilized technically to conduct reviews of regulatory entities’ AML/CFT compliance systems.

“The off-site inspection will primarily focus on identifying general Money Laundering and Terrorist Financing (ML/TF) risk landscape of each sector and its components, the inherent risks profile of each reporting entity, the potential weaknesses in each reporting entity’s-controlled measures, and the adequacy of mitigating measures”, Mr. Nasser clarified.

He also said the pending on-site inspections will assess the reporting entities’ AML/CFT/P policies and procedures, review their compliance with the AML/CFT Act of 2021 and the FIA Act of 2021; and all AML/CFT regulatory frameworks in force. The on-site inspections will also evaluate gaming companies’ and other reporting entities’ levels of AML/CFT risk potentials.

Mr. Nasser elaborated that managements of reporting entities (REs) are charged with the responsibility of designing, adopting, and executing effective AML/CFT policies and procedures, and controlled mechanisms; to guarantee reasonable assurances of their respective commitment to adhering to Liberia’s AML/CFT legislations and regulatory frameworks.

“Section 15.3 of the AML/CFT Act of 2021 sets out a list of preventive measures that are to be in place by reporting entities. These preventive measures are building blocks for effective AML/CFT systems, required to monitor, detect and report suspicious financial transactions or activities to the FIA”, Mr. Nasser stressed.

Furthermore, Mr. Nasser explained that “Section 67.3(17) of the FIA Act of 2021 designates the Agency as the primary AML/CFT regulator and supervisor, responsible to monitor and enforce compliance to all AML/CFT obligations as outlined in the AML Act of 2021, and in accordance to the Targeted Financial Sanctions Against Terrorist Act of reporting entities, as well as to conduct off-site surveillance and on-site examinations independently, through exercising supervisory powers, responsibilities, and imposing administrative sanctions pursuant to the AML Act of 2021.”

For his part, NLA Director General, Reginald Nagbe, reiterated his institution’s commitment to fostering stronger cooperation and collaboration with the FIA to mitigate the prospects of criminals using the gaming sector as a vessel for financial crimes in Liberia. He lauded the FIA for what he described as a “passionate and proactive leadership” in Liberia’s AML/CFT regime; adding that Liberia was now “on the right trajectory in its fight against money laundering, terrorist Financing and proliferation financing (ML/TF/PF).”