GUIDELINES AND FEEDBACK – ANTI MONEY LAUNDERING AND TERRORISM FINANCING IN CAMEROON AND CEMAC
Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) constitutes the regulatory framework applicable in Cameroon for the purpose of preventing criminals from disguising the proceeds of criminal activity as legitimate funds and forestalling the financial support of terrorist organizations. In accordance with Law No. 01 /CEMAC/UMAC/CM of 11th April 2016, the two main concepts of this aspect are as follows:
- Money Laundering: Money laundering is the process by which funds derived from illegal activities such as drug trafficking, corruption, or organized crime are converted into ostensibly legitimate assets. The process typically proceeds through three distinct stages: placement, layering, and integration.
- Terrorist Financing: The raising, movement, and utilization of funds for the purpose of providing financial resources to terrorists or terrorist organizations.
How Anti Money Laundering and Counter Terrorism Financing Works in Cameroon
- Customer Due Diligence (CDD)/KYC: Financial and regulated institutions are required to verify the identity of their customers, assess the associated risk levels, and ascertain the source of funds prior to the provision of any services.
- Transaction Monitoring: Advanced software systems and trained analysts monitor financial transactions for unusual patterns and large-sum transfers in order to detect and flag potential criminal activity.
- Reporting Obligations: COBAC Regulation R-2023/01 demands that reporting entities shall have internal policies and procedures, put together by management and approved by the board of directors, to manage and mitigate the risks of money laundering and terrorist financing in their business.
- Record Keeping: Obliged entities must retain all customer and transactional records for a minimum of 10 years.
Regulatory and Enforcement Bodies in Cameroon
- ANIF (National Financial Investigation Agency): The National Agency for Financial Investigation (ANIF) serves as Cameroon's Financial Intelligence Unit (FIU) and is vested with the responsibility of receiving, investigating, and analysing Suspicious Transaction Reports (STRs). Further details regarding its operational mandates may be accessed on the ANIF website.
- COBAC (Banking Commission of Central Africa): The regional body responsible for the regulation and supervision of credit institutions, with a mandate to enforce compliance with regional Anti-Money Laundering and Counter-Financing of Terrorism (AML/CFT) directives. Further information regarding its prudential requirements may be found on the COBAC Portal.
GUIDELINES AND FEEDBACK FROM FINANCIAL INSTITUTIONS IN CAMEROON
Data Protection and Information Sharing
Financial institutions that are part of a group shall implement group-wide policies and procedures, including data protection policies and procedures for information sharing within the group for the purposes of combating money laundering and terrorist financing. These policies and procedures shall be effectively implemented at the branch and subsidiary level, established in Member States and in third countries.
Where a financial institution has branches or subsidiaries in third countries where the minimum obligations for combating money laundering and terrorist and proliferation financing are less stringent than in the territory in which it is established, those branches and subsidiaries shall apply the obligations in force in its territory, including those relating to data protection, to the extent permitted by the laws and regulations of the third countries in question. The supervisory authorities concerned shall inform each other of cases in which the legislation of a third State does not permit the application of the measures required, so as to undertake coordinated action to find a solution.
Where the legislation of the third State does not permit the application of the measures required, financial institutions shall take additional measures to effectively address the risk of money laundering or terrorist financing and shall inform the supervisory authorities of their home State. If these additional measures are insufficient, the competent authorities of the home State shall consider further supervisory measures, including, where appropriate, requesting the financial group to cease its activities in the host State.
Implementation of Risk Assessment and Management Systems
Financial institutions shall implement risk assessment and management systems for money laundering and terrorist financing.
They shall take measures proportionate to their risks, their nature, and their size, to ensure that the employees concerned are aware of the provisions adopted pursuant to this Regulation, including the applicable data protection requirements.
The measures shall include the participation of the employees concerned in special continuing education programs designed to help them recognize transactions that may be related to money laundering or terrorist financing and to instruct them on how to proceed in such cases.
Application of Due Diligence Measures in Branches and Subsidiaries
Financial institutions shall apply measures at least equivalent to those provided for in Chapter III of Title II of the regulation, with regard to customer due diligence and information retention in their branches located abroad. They shall ensure that equivalent measures are applied in their subsidiaries located abroad.
Where applicable local law does not allow them to implement equivalent measures in their branches and subsidiaries abroad, financial institutions shall inform the ANIF and the supervisory authority to which they are subject.
Financial institutions shall communicate the appropriate minimum measures for combating money laundering and terrorist financing to their branches and subsidiaries located abroad.
Feedback
The persons referred to in Articles 6 and 7 and the supervisory and control authorities referred to in Article 91 of the regulation shall receive from the ANIF the information it holds on money laundering and terrorist financing mechanisms, as well as the follow-up to their suspicious transaction reports.