Countries/Jurisdictions of Primary Concern - Guinea-Bissau
Guinea-Bissau continues to experience political disruptions due to the transit of narcotics and the flow of money related to the drug trade. The cohesion and effectiveness of the state itself is very poor; corruption and impunity are major problems and the judiciary has demonstrated its lack of integrity on a number of occasions. On April 8, 2010, the United States Department of the Treasury designated two Guinea-Bissau-based individuals – former Bissau-Guinean Navy Chief of Staff Jose Americo Bubo Na Tchuto and Air Force Chief of Staff Ibraima Papa Camara – as drug kingpins. On April 2, 2013, the U.S. Drug Enforcement Administration arrested Na Tchuto.
On May 18, 2012, the UNSC adopted resolution 2048 imposing a travel ban on five Bissau-Guinean military officers in response to their seizure of power from the civilian government on April 12, 2012. On May 31, 2012, the EU followed with a travel ban and freezes on the assets of the military junta members.
One of the poorest countries in the world, the value of the illicit narcotics trade in Guinea-Bissau is very large compared to the size of the Bissau-Guinean economy. Drug proceeds, often in U.S. dollars, circulate in Guinea-Bissau, albeit outside the formal financial system. Traffickers from Latin America and collaborators from the region continue to take advantage of the extreme poverty, unemployment, political instability, lack of effective customs and law enforcement, corruption, and general insecurity to make the country a major transit point for cocaine destined for consumer markets, mainly in Europe. A multitude of small offshore islands, upon or near which drug shipments may be dropped, and complicit officials and military officers able to sidestep weak and under-resourced enforcement efforts with impunity contribute to the problem. Transition President Nhamadjo has declared the problem a top priority for his administration, although no resources have been devoted to this effort, nor is there the capacity to take steps toward enforcement.
The formal financial sector in Guinea-Bissau is undeveloped, poorly supervised, and dwarfed by the size of the underground economy.
For additional information focusing on terrorist financing, please refer to the Department of State’s Country Reports on Terrorism, which can be found at: http://www.state.gov/j/ct/rls/crt/
DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR ILLEGAL DRUG SALES THAT OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO
CRIMINALIZATION OF MONEY LAUNDERING:
“All serious crimes” approach or “list” approach to predicate crimes: All serious crimes
Are legal persons covered: criminally: YES civilly: YES
KNOW-YOUR-CUSTOMER (KYC) RULES:
Enhanced due diligence procedures for PEPs: Foreign: YES Domestic: YES
KYC covered entities: Banks, microfinance institutions, exchange houses, securities broker/dealers and firms, insurance companies, casinos, charities, nongovernmental organizations (NGOs), lawyers, accountants, and notaries
Number of STRs received and time frame: 1: May 2013 - November 2013
Number of CTRs received and time frame: Not available
STR covered entities: Banks, microfinance institutions, exchange houses, securities broker/dealers and firms, insurance companies, casinos, charities, NGOs, lawyers, accountants, and notaries
MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:
RECORDS EXCHANGE MECHANISM:
With U.S.: MLAT: NO Other mechanism: NO
With other governments/jurisdictions: YES
Guinea-Bissau is a member of the Inter Governmental Action Group against Money Laundering in West Africa (GIABA), a FATF-style regional body. Its most recent mutual evaluation can be found at: http://www.giaba.org/reports/mutual-evaluation/Guine-Bissau.html
ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:
The Government of Guinea-Bissau has not fully implemented relevant international conventions against money laundering and terrorist financing, in large part because of underlying deficiencies in its AML/CFT regime; although scarce resources, weak border controls, and under-resourced and understaffed police are contributory factors. Guinea-Bissau has signaled its intention to adopt regulatory measures to implement the International Convention for the Suppression of the Financing of Terrorism, but has provided no specific timeframe for doing so.
The Anti-Money Laundering Uniform Law, a legislative requirement for members of the West African Economic and Monetary Union (WAEMU), has been adopted by Guinea-Bissau, but is still awaiting publication and so is not yet in force. Guinea-Bissau has yet to criminalize most of the designated predicate offenses and maintains entirely inadequate legal provisions for the conduct of customer due diligence on the part of Bissau-Guinean financial institutions. Article 26 of National Assembly Resolution No. 4 of 2004 stipulates that if a bank suspects money laundering it must obtain a declaration of all properties and assets from the subject and notify the Attorney General, who must then appoint a judge to investigate. The bank’s solicitation of an asset list from its client could amount to informing the subject of an investigation. In addition, banks are reluctant to file STRs for fear of alerting the subject because of allegedly indiscrete authorities. There is no record of investigations, prosecutions, or convictions for the offense of money laundering. Although the law establishes asset forfeiture authorities and provides for the sharing of confiscated assets, a lack of coordination mechanisms to seize assets and facilitate requests for cooperation in freezing and confiscation from other countries may hamper cooperation.
Guinea-Bissau’s financial intelligence unit (FIU) is only partially functional, in part owing to a lack of both reliable resources and analytical staff. Nevertheless, in 2013, Guinea-Bissau’s FIU responded to a request for information from another FIU in the region, conducted numerous sensitization and capacity-building programs for key stakeholders, and secured new and more suitable office space.
Guinea-Bissau lacks a framework for freezing terrorist assets pursuant to UNSCRs 1267 and 1373, although it has taken recent actions to support the creation of such a framework. The Bissau-Guinean Council of Ministers has approved a bill, which was before Parliament as 2013 closed, to validate the Portuguese translation of WAEMU Regulation 14 on the freezing of assets; approved a decree to designate the Ministry of Finance as the competent authority for the freezing of assets, although as 2013 closed it was still awaiting presidential signature; and agreed to designate the Ministries of Finance, Justice, the Interior, and Foreign Affairs as the Inter-Ministerial Committee on Asset Freezing.
Guinea-Bissau needs to improve the coordination of efforts at the national, sub-regional, regional, and international levels; reform the country’s institutions; and conduct further internal investigations to gain an accurate understanding of the scale of the AML/CFT problem. Guinea-Bissau should continue to work with its bilateral and GIABA partners to establish and implement an effective AML/CFT regime. The Bissau-Guinean civil authorities and law enforcement agencies should work urgently to restore sovereignty, administer justice, and establish border controls. Guinea-Bissau should ensure the sectors covered by its AML law have implementing regulations and competent supervisory authorities. It also should implement fully its terrorism financing law, recruit technical staff for its FIU, and ensure the FIU’s operational independence. It should work to improve the training and capacity of its police and judiciary to combat crimes. Guinea-Bissau should also undertake efforts to eradicate systemic corruption.