“The imposed sanctions were deemed sufficiently deterrent and have enabled financial institutions’ management bodies to design, refine, and implement governance policies and internal control programs for regulatory compliance,” stated the sectoral risk assessment report on money laundering, accessed today.
The document, resulting from the evaluation conducted between 2023 and 2024, adds that the current legislation “provides for effective and deterrent sanctions” for violations of the laws on the prevention and combating of money laundering, and notes that the Bank of Mozambique “has imposed sanctions on institutions under its supervision.”
However, in this process, the report also highlights “deficiencies,” such as the effectiveness of administrative measures being “questioned in the overall assessment when faced with the application of criminal sanctions,” as there is “only a record of sanctions applied to institutions and not to the members of the management bodies, as recommended internationally.”
It adds that the legislation on the prevention and combatting of money laundering provides for up to 12 years in prison for committing the crime of money laundering, and up to 24 years for cases of financing terrorism.
“However, there is no solid evidence that specific individuals have been convicted of these crimes,” the report states.
The Bank of Mozambique indicates that, based on a new supervisory methodology, it has conducted seven inspections of credit institutions, “having issued the appropriate recommendations and established the corresponding program to correct identified deficiencies.” However, “issues related to the scarcity of human resources remain, as only eight workers are focused on these matters to cover the universe of supervised institutions.”
The central bank acknowledges, therefore, that the human resources are “disproportionate to the number of institutions to be supervised and the challenges arising from the market entry of new financial products and services,” as well as the “reduced number of inspections carried out.”
By the end of 2023, the Mozambican financial system regulated by the Bank of Mozambique comprised 15 banks, 13 microbanks, three electronic money institutions, four fund transfer institutions, four credit cooperatives, 13 savings and loan organizations, two securities brokerage firms, six exchange houses, and 2,212 microcredit operators, among others.
The banks operated a total of 658 branches across the country, while microbanks and credit cooperatives totaled 85 branches, with financial institutions collectively holding assets worth 918.4 billion meticais (12.2 billion euros).
