Regulatory and Investigations - recent trends and developments in Africa

Welcome to the January edition of the Addleshaw Goddard Africa Group Newsletter in which we examine white-collar crime with guest editing from our Global Investigations team. The team specialises in all aspects of criminal liability, compliance, and defending corporate and individual clients against enforcement action, particularly in the sphere of financial crime.

Introduction

Their work lends itself to international collaboration with regional partners as regulators have increasingly sought to strengthen their own international reach in recognition of the fact that financial crime often involves multiple jurisdictions and capital flight across borders to evade enforcement or detection.

Lawyers globally are increasingly familiar with the long reach of the United States Foreign Corrupt Practices Act, the UK Bribery Act, and the EU and UK Proceeds of Crime and Money Laundering regimes. Increasingly UK regulators are also examining supply chain issues including modern slavery and the associated supply chain due diligence obligations, and UK Courts have also displayed a willingness to examine health and safety and environment issues pertaining to subsidiaries in Africa and elsewhere when significant breaches of good practice occur.

This edition examines these legal developments, particularly examples of enforcement pertaining to Africa, local regional and multilateral developments, and the steps we recommend to mitigate risk. We hope you enjoy reading it.

Guest Editorials

The UK Bribery Act ten years on

Michelle de Kluyver, Partner and India Haresign, Associate, Addleshaw Goddard

Michelle de Kluyver and India Haresign discuss Africa-related enforcement actions under the UK Bribery Act 2010 (UKBA)(and previous UK legislation) and reflect on the issues that corporates and their advisers should be considering when entering or operating in African markets.

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Parental Liability for Foreign Subsidiaries

Iain Daniels, Barrister and Angus Bunyan, Barrister, 2 Hare Court

It is a common (and unobjectionable) practice for multinational companies to operate via subsidiaries in Africa (and other developing parts of the world). Many of those subsidiaries carry out activities that are inherently risky both to human health and to the wider environment.

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A Date with Data Destiny

Rui Lopes, Managing Director, Lopes Attorneys Inc.

With the rapid rate of technological change occurring within economies throughout the globe, the value of personal information has increased astronomically, as personal data is ever-increasingly mined, traded and monetised, which has brought with it real fears by both companies and individuals on the manner in which such personal information is stored and processed.

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DRC bank gets anti-monday laundering certification

BGFIBank DRC has become one of the first financial institutions in Sub-Saharan Africa to receive the AML 30000 anti-money laundering certification.

A Democratic Republic of Congo-based bank has obtained an international anti-money laundering certification, one of the first banks in Sub-Saharan Africa to do so.

BGFIBank DRC, the Kinshasa-headquartered subsidiary of Gabon-headquartered BGFIBank Group, secured AML 30000 certification in December. AML 30000 is an evaluation and endorsement of a company’s risk assessment, know-your-client processes, document retention, suspicious activity reporting, governance, IT and resources.

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Ghana wants out of money laundering ‘grey list’ as new law passed

Parliament has enacted the Anti-Money Laundering Bill 2020 to strengthen Ghana’s anti-money laundering legal framework and help the country exit the “grey list” of the Financial Action Task Force (FATF).

In April 2009, Ghana was blacklisted by the FATF after an evaluation exercise by the Inter-Governmental Action Group against Money Laundering in West Africa (GIABA), in which the country scored zero compliance on 16 key FATF recommendations.

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FIU Announces Liberia’s Removal from Downgraded Status by GIABA

With the exit of Liberia from the enhanced expedited reporting process, the Financial Intelligence Unit (FIU) of Liberia has announced Liberia’s automatic removal from its previous downgraded status by the Inter-Governmental Action Group against Money Laundering and Terrorist Financing in West Africa (GIABA).

GIABA is a specialized institution of the Economic Community of West African States (ECOWAS) responsible to facilitate the adoption and implementation of anti-money laundering and countering the financing of terrorism (AML/CFT) measures.

The decision taken by GIABA’s regional body on Liberia, according to a press statement from the FIU, was due to the country’s progress in addressing some of the deficiencies in its Anti-Money Laundering regime.

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Bank of Tanzania moves against forex black market

Bank of Tanzania (BOT) has teamed up with Tanzania Police Force to crackdown on a cartel of black market money dealers who have mushroomed in the country in recent days.

BoT Manager for Microfinance and Bureau de Change Supervision, Mr Victor Tarimu told The Citizen that the Central Bank has been receiving information from various sources about the existence of an informal foreign exchange market in the country.

In that regard, BoT has commenced working in collaboration with law enforcement organs to crackdown on the cartel that could significantly have a negative impact on the country’s economy.

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Kenya vows to implement global standards to curb tax evasion lock

Kenya on Friday committed to implementing international standards on transparency and exchange of information for tax purposes as part of a national effort to curb tax evasion and illicit financial flows.

Julius Muia, National Treasury Principal Secretary, assured global tax administration players that Kenya is on course to implement automatic exchange of information protocols on tax matters by September 2022.

“This commitment to the Global Forum and the implementation of the international standards of transparency and exchange of information is because Kenya appreciates the importance of international co-operation in addressing the challenges of tax evasion,” Muia said.

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McKinsey to repay more than $40m over South African scandal

McKinsey will repay tens of millions of dollars in fees to South Africa after a judicial inquiry into alleged systemic corruption in the country uncovered evidence of irregularities in contracts that the consultancy firm had with a local partner at government-owned companies.

The firm has undertaken to pay back all of the money that it earned on the contracts, an amount that is “likely to be around R650m ($43m)”, the judicial inquiry said on Wednesday, a day before senior McKinsey partners will appear before it.

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After Luanda Leaks, a billionaire’s empire falls, but her enablers carry on

The jolt of energy delivered to the anti-corruption movement in Angola came from an unexpected source.

In January, the International Consortium of Investigative Journalists and partners in 20 countries published the Luanda Leaks investigation, documenting two decades of inside deals and government giveaways, aided by Western lawyers and advisers, that made Isabel dos Santos, the daughter of the southern African country’s long time strongman ruler, enormously rich.

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Afreximbank Launches MANSA, Africa’s Digital Due Diligence Repository

African Export-Import Bank (Afreximbank) has officially launched the operations of ‘MANSA’, a pan-African customer due diligence repository for financial institutions, corporate entities and SMEs, developed to address the perceived risk of doing business in Africa and with Africans.

MANSA is a single source of the primary data required for Customer Due Diligence (CDD) and Know Your Customer (KYC) checks on African entities, including financial institutions, corporates and SMEs, in accordance with best practices.

The platform will also serve to address key trade related challenges facing the continent, including, the lack of market information, the high cost of doing business in Africa and discovering African counterparties.

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