Malawi NGOs vulnerable to money laundering
Non-governmental organisation (NGO) Board says local NGOs are still susceptible to money laundering and terrorism financing and has since called for the need to raise more awareness on the problem.
NGO Board chief executive officer Voice Mhone said in Lilongwe during a breakfast meeting organised to share key findings and recommendations on the mutual evaluation exercise conducted by the institution.
He noted that it was clear that the NGO sector in Malawi mobilises a lot of money from foreign sources, running the risk of receiving money from sources that are rated risky.
“When it comes to money laundering and financing terrorism, we don’t have the capacity to monitor and that’s why [our] report has clearly highlighted recommendations on our weaknesses. It has shown 100 percent weakness within the NGO Board and the NGO sector in terms of capacity.
“The lack of capacity is affecting the country as a whole, and to deal with this we need to raise awareness to all NGOs and review the NGO Act,” said Mhone also referring to a Financial Intelligence Authority (FIA) report which has rated Malawi poorly on fighting money laundering in the sector.
Independence Governance Advisor on NGO regulations Robin Mac-Gregor said Malawi, like all countries, is exposed to the risks of terrorism financing and money laundering in the NGO sector.
“These are the issues that need to be tackled jointly between government and the NGO community. A close working relationship is required to make this a success,” he said.
Money laundering is any act or attempted act to conceal the identity of illegally obtained proceeds so that they appear to have originated from legitimate sources.
Common sources of illicit money in Malawi, just like other affected countries, include drug trafficking, bribery and corruption, extortion, fraud, robbery, kidnapping, human trafficking, smuggling (arms, people or goods), counterfeiting, forgery, tax evasion, among others.
On his part, FIA compliance manager Masautso Ebere said Malawi performed poorly in accountability and risk assessments of the NGOs.
“Having received the report last year in September it means we have two years’ and by September 2021, we need to have all the relevant laws in place to curb the malpractice,” he said.
