Ghana's Finance Minister Calls Out European Union Over Money Laundering Blacklist

Strategic Insights -

Ghana has been facing intense pressure from the European Union (EU) over allegations of non-compliance with money laundering and terrorism financing regulations, but the country's Finance Minister, Ken Ofori-Atta, has fired back, calling the EU's decision "hypocritical" and "a sledgehammer thrown at us." The EU blacklisted Ghana, along with 11 other countries, earlier this month, citing concerns over money laundering and terrorism financing. However, Ghana's Ministry of Finance has responded, stating that the EU's move does not reflect the current status of the country's Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) regimes.

Key Takeaways:

  • Ghana's Finance Minister, Ken Ofori-Atta, has criticized the European Union's decision to blacklist the country over money laundering and terrorism financing concerns, citing hypocrisy and a lack of fairness.
  • Ghana has been placed on a list of countries under the watch of the EU for certain money-laundering activities due to an observation by the Financial Action Task Force (FATF).
  • The EU proposed the blacklisting of Ghana and 11 other countries on May 7, 2020, and the measure took effect in October 2020.
  • The Financial Action Task Force (FATF) had observed that Ghana's AML/CFT regime needs improvement, prompting the EU to take action.
  • The EU's move has resulted in some banks in Europe not doing business with Ghanaian institutions, both public and private.
  • Ghana's embassy in Brussels has been ordered to close its bank accounts due to the EU's blacklisting decision.
  • The investigation by the International Consortium of Investigative Journalists (ICIJ) and other media partners found that HSBC Bank continued to provide banking services to alleged criminals, Ponzi schemers, shell companies tied to looted government funds, and financial go-betweens for drug traffickers.
  • HSBC admitted to U.S. prosecutors in 2012 that it had helped dirty money flow through its branches around the world, including at least $881 million controlled by the notorious Sinaloa cartel and other Mexican drug gangs.
  • The FinCEN Files investigation found that HSBC's highly profitable branch in Hong Kong played a key role in keeping the dirty money flowing, with the bank filing reports lacking crucial customer information on shell companies that had processed nearly $1.5 billion in more than 6,800 transactions through the bank's Hong Kong operations alone.
  • HSBC increased its compliance staff from a few hundred members in 2012 to several thousand in 2017 and invested more than $1 billion in compliance initiatives since 2015.

Statistics:

  • $881 million: The amount of money controlled by the notorious Sinaloa cartel and other Mexican drug gangs that HSBC helped flow through its branches around the world.
  • $1.5 billion: The amount of money processed by shell companies holding commercial accounts with HSBC Hong Kong between 2011 and 2016, with HSBC filing reports lacking crucial customer information.
  • 87 million Euros: The amount of budgetary support donated by the European Union to assist Ghana in its response to the COVID-19 crisis.
  • 2012: The year HSBC admitted to U.S. prosecutors that it had helped dirty money flow through its branches around the world.
  • 2017: The year HSBC increased its compliance staff from a few hundred members in 2012 to several thousand.

Sources:

  • Ghana's Ministry of Finance statement regarding the EU's move to blacklist the country.
  • The Financial Action Task Force (FATF) report on Ghana's AML/CFT regime.
  • The International Consortium of Investigative Journalists (ICIJ) investigation into HSBC Bank's money laundering activities.
  • The European Union's proposal to blacklist Ghana and 11 other countries on May 7, 2020.
  • The FinCEN Files investigation into HSBC Bank's money laundering activities.
  • HSBC's statement regarding its compliance initiatives since 2015.
  • The Herald news article on Ghana's Finance Minister's comments regarding the EU's blacklisting decision.