CB Circular No. 13 of 2024 - Invitation to the 7th ESAAMLG Public-Private Sector Dialogue — BOZ — ZM

[Bank of Zambia Logo]
Bank of Zambia
OFFICE OF THE DEPUTY GOVERNOR - OPERATIONS

BOZ/EXEC/DGO/fcs/bp

July 30, 2024

CB Circular No. : 13/2024

To : Heads of Financial and Payment Service Providers

INVITATION TO THE SEVENTH PUBLIC-PRIVATE SECTOR DIALOGUE OF THE EASTERN AND SOUTHERN AFRICA ANTI-MONEY LAUNDERING GROUP

The Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) will be hosting its seventh Public-Private Sector Dialogue (PPSD) in Diani, Kenya from August 30 – 31, 2024.

The theme for this year’s PPSD is ‘Strengthening the Countering of Financing of Terrorism (CFT) Efforts in the ESAAMLG Region through Enhanced Collaboration’. The PPSD will commence in the afternoon on Friday, August 30, 2024, immediately after the 24th ESAAMLG Council of Ministers Meeting. Attached hereto is the Concept Note and programme for the PPSD.

Considering the above, we would like to extend an invitation to your institutions to participate in the PPSD. Your institutions can each nominate a maximum of two officers who are responsible for the management of AML/CFT matters. Please take note that each institution is expected to bear the cost of participation for its nominated officers.

For any clarifications, please contact Mr Joseph Munyoro, Assistant Director – AML/CFT Supervision on jmunyoro@boz.zm.

[Signature]
Francis Chipimo (PhD)
DEPUTY GOVERNOR – OPERATIONS

cc Director – Financial Conduct Supervision
Director – Prudential Supervision
Director – Payment Systems

[ESAAMLG Logo]
7th Public Private Sector Dialogue
August 30-31, 2024
Diani, Kwale, Kenya
Concept Note by ESAAMLG Secretariat for the Public Private Sector Dialogue (PPSD) on Terrorist Financing

June 2024

Contents

I. Introduction................................................................................................................................ 3
III. Context...................................................................................................................................... 4
IV. Objectives.................................................................................................................................. 6
V. Participants................................................................................................................................ 6
VI. Conclusion................................................................................................................................. 7

[ESAAMLG Logo]

Concept Note: Public Private Sector Dialogue on Strengthening the Countering Financing Terrorism (CFT) Efforts in the ESAAMLG Region through enhanced Collaboration

I. Introduction

This concept note presents a proposal for the 7th Public Private Sector Dialogue (PPSD) to be hosted by the Government of Kenya and organized by the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) Secretariat.

II. Background

For the past years, ESAAMLG has organized the PPSD which is an initiative that provides a platform for the public and private sectors to discuss topical anti-money laundering and countering the financing of terrorism and proliferation (AML/CFT/CPF) matters affecting the region. The ESAAMLG is a Financial Action Task Force (FATF) Style Regional Body (FSRB) which was established in 1999 and currently consists of 21¹ members and 34² observer members. The dialogues have seen significant attendance by senior government officials across and beyond the region, along with participation from the Private Sector, Cooperating Organizations

¹ Members: Angola, Botswana, Burundi, Eritrea, Eswatini, Ethiopia, Kenya, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Rwanda, Seychelles, South Africa, South Sudan, Tanzania, Uganda, Zambia and Zimbabwe.

² For the Observer members: https://www.esaamlg.org/index.php/about_countries_cooperative_partner. Democratic Republic of Congo is a regional observer member.

and Supporting Nations, and the FATF. The feedback from both regional and international attendees has been overwhelmingly positive, creating strong demand for more dialogues to build on the success of the past six events. The Republic of Kenya, the host for the 48th Task Force meeting and 24th Council of Ministers meeting, will host the 7th PPSD. The theme for the PPSD is "Strengthening the Countering of Financing of Terrorism (CFT) Efforts in the ESAAMLG Region through enhanced Collaboration"

III. Context

Eastern and Southern Africa face significant challenges from terrorism and terrorist financing, with several groups operating in the region and exploiting vulnerabilities in financial systems. In Eastern Africa, the Al-Shabaab, for example, poses a severe threat, conducting attacks in Kenya, Uganda, and beyond. Meanwhile, in Southern Africa, the insurgency in Mozambique's Cabo Delgado province, driven by ISIS-Mozambique (also known as Ansar al-Sunna), has escalated dramatically, leading to substantial displacement and economic disruption. Additionally, the porous borders and weak regulatory frameworks in several countries facilitate the movement of funds and resources that support these terrorist activities, exacerbating the region's instability and undermining development efforts.
Recognising the magnitude of the problems of terrorism and TF in the ESAAMLG Region, Countries in the region are taking steps such as enhancing the legal and institutional frameworks to improve their Counter-Terrorism (CT) and Countering the Financing of Terrorism (CFT) measures. However, the main findings from their Mutual Evaluation Reports (MERs) indicate that while there have been improvements on technical compliance, significant gaps remain on effectiveness. Many countries struggle with fully implementing FATF Recommendations, particularly in areas like TF risk assessment and understanding, cooperation including information sharing between public bodies, and between public and private sectors, the effective use of financial intelligence units and collecting TF related STRs in terms of quality, quantity and

diversity. Common challenges include insufficient resources, lack of technical expertise, capacity issues on the effective use of technologies and weak enforcement mechanisms, all of which hinder the effectiveness of CT and CFT efforts in the region. Ineffective CFT measures will allow terrorists, terrorist cells and terrorist groups to thrive, leading to increased attacks, instability, loss of life and weakened economies. It is therefore imperative to improve the effectiveness of the CFT systems by taking the necessary priority actions including by enhancing the existing CFT coordination and cooperation between the public-public and public-private stakeholders at domestic and international level.

5. Strengthening cooperation between the public and private sectors is crucial in the collective effort to counter the financing of terrorism. Effective collaboration facilitates the exchange of information, enhances regulatory compliance, and promotes the implementation of robust AML/CFT measures. Public sector agencies provide supervisory oversight and enforcement capabilities, while private sector entities, including financial institutions and technology firms, contribute expertise in financial intelligence and technological solutions. Together, they form a unified front against terrorism financing, leveraging shared resources and insights to detect suspicious activities and disrupt illicit financial flows. This may sometimes involve incorporating players or stakeholders not traditionally included. By fostering a collaborative environment grounded in transparency and mutual trust, stakeholders can more effectively mitigate the risks posed by terrorist financing networks and safeguard global financial systems.

3. This dialogue with a theme "Strengthening the Countering of Financing of Terrorism (CFT) Efforts in the ESAAMLG Region through enhanced Collaboration" presents an opportunity for stakeholders from both the public and private sectors to engage and have a way forward on enhancing both the private and public sectors' implementation of CFT measures.

By covering the above issues, this dialogue seeks to enhance the detection and prevention of terrorist financing by leveraging the unique insights and capabilities of each sector. By working together, public and private sectors can develop more effective strategies, improve compliance with regulatory requirements, and ensure the timely identification and reporting of suspicious activities. Ultimately, such collaboration would strengthen the overall resilience of the financial system against the threats of terrorism financing.

IV. Objectives

The key objectives of the 7th PPSD are as follows:

a. To foster an understanding of the fundamental elements of countering the financing of terrorism and regulatory compliance including understanding and implementation of TF related STR and TFS obligations. b. To explore the role of technology in enhancing financial transparency and resilience against terrorism financing.
c. To share best practices and case studies on successful approaches to countering the financing of terrorism including on the risk-based oversight and monitoring of NPOs for CFT purposes.
d. To strengthen regional and international cooperation and exchange of information among ESAAMLG member countries and partners.

V. Participants

The participants will be drawn from the following sectors:

Banks and non-bank financial institutions.
Relevant Designated Non-Financial Businesses and Professions (DNFBPs);
VASPs;
Supervisory bodies;
Financial technology experts;

CFT and CT Law Enforcement Authorities;
CFT related sanction bodies;
Mobile Network Operators ( for example Safaricom, Vodacom, MTN, Airtel);
Relevant NPOs; and
Experts on TF.

VI. Conclusion

Over the years, the PPSD has served as a pivotal platform for fostering collaboration, dialogue between public and private sector stakeholders, tapping into each other's expertise to address challenges and share best practices in AML/CFT measures. The theme of this year’s PPSD, "Strengthening the Countering of Financing of Terrorism (CFT) Efforts in the ESAAMLG Region through enhanced Collaboration" underscores the importance of understanding fundamental elements, embracing technological advancements, and promoting synergy among stakeholders in combating terrorism and its financing. The dialogue aims at enhancing participants' knowledge and capabilities in countering the financing of terrorism, equipping them with insights into emerging trends and innovative strategies.
It is imperative that ESAAMLG member countries and stakeholders continue to strengthen their commitment to effective implementation of counter terrorism financing measures. Implementation of the outcomes and recommendations from this dialogue, can further bolster regional cooperation, enhance regulatory frameworks, and mitigate the risks posed by terrorism financing networks.

For any further inquiries, please contact any one of the following contact persons:

Director, Bank Supervision Department, Central Bank of Kenya
Email: fin@centralbank.go.ke
Tel: +254 020 2863001
Mr. Tirivafi Nhundu, ESAAMLG Secretariat
Email: t.nhundu@esaamlg.org
Tel: +255 696 708 540
Ms. Vanevola Otieno, ESAAMLG Secretariat
Email: votieno@esaamlg.org
Tel: +255 752 403 666