OBLIGATION OF NON-PROFIT ORGANIZATIONS IN CAMEROON – 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.
OBLIGATIONS OF NON-PROFIT ORGANIZATIONS IN CAMEROON
- Oversight by Competent Regulatory Bodies
Any non-profit organization that raises, receives, donates, or transfers funds in the course of its philanthropic activities is subject to appropriate oversight by its competent regulatory body.
The competent authority establishes rules to ensure that the funds of its non-profit organizations are not used for money laundering or terrorist financing.
- Oversight and Control Measures for Non-Profit Organizations
Non-profit organizations are required to:
1) Provide information at all times on:
- The purpose and objective of their activities;
- The identity of the person or persons who own, control, or manage their activities, including officers, board members, and directors;
2) Make their financial statements available to the regulatory authorities, with a breakdown of their income and expenses.
3) To establish mechanisms to help them combat money laundering and the financing of terrorism;
4) to establish their own control mechanisms to ensure that all funds are properly accounted for and used in accordance with the stated purpose and objectives of their activities;
5) to retain records of their operations for ten (10) years and make them available to the authorities.
- Special Due Diligence Obligation for Non-Profit Organizations
Any non-profit organization wishing to raise funds, receive funds, or order fund transfers must:
1) register in a register established for this purpose by the competent authority. The initial registration application must include the names, surnames, addresses, and telephone numbers of all persons responsible for the operation of the organization in question, including the president, vice-president, secretary general, members of the board of directors, and treasurer, as applicable;
2) notify the authority responsible for maintaining the register of any changes in the composition of the previously designated responsible persons referred to in the preceding paragraph.
Any donation made to a non-profit organization of an amount equal to or greater than five hundred thousand (500,000) CFA francs must be recorded in the register referred to in paragraph 1 of this article, including the donor's full contact information, the date, nature, and amount of the donation.
The register referred to in paragraph 1 of this article is kept by the competent authority for a period of ten (10) years, without prejudice to longer retention periods prescribed by other applicable laws or regulations. It may be consulted by the ANIF (National Agency for Financial Information), the judicial authorities, judicial police officers conducting a criminal investigation, upon request, or any authority responsible for monitoring non-profit organizations.
Any donation to a non-profit organization of an amount equal to or exceeding one million (1,000,000) CFA francs must be declared to the ANIF (National Financial Intelligence Agency) by the authority responsible for maintaining the register referred to in paragraph 1 of the first subparagraph above.
Any donation to a non-profit organization, regardless of the amount, must also be declared to the ANIF by the competent authority when the funds are likely to be related to a terrorist enterprise or the financing of terrorism.
Non-profit organizations must, on the one hand, comply with the obligation to maintain accounting records in accordance with applicable standards and, on the other hand, submit their annual financial statements for the previous year to the supervisory authority within six (6) months of the end of their fiscal year. They deposit into a bank account opened with an authorized banking institution all sums of money given to them as donations or as a result of transactions they carry out.
Without prejudice to any legal action that may be taken against them, the competent authority may order the temporary suspension or dissolution of non-profit organizations that knowingly encourage, instigate, organize, or commit any of the offenses referred to in Articles 8, 9, and 10 of the regulations.
In these cases, the competent authority transmits the decision taken to the ANIF along with all the information that led to said decision.