MP Urges Financial Intelligence Unit to Lead by Example in Anti-Money Laundering Efforts

Directive to Combat Money Laundering

A member of parliament has called on the transitional government’s Financial Intelligence Unit (FIU) to lead by example in implementing a new directive for compulsory use of licensed banking in transactions to combat money laundering.

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On May 6, the FIU issued a mandatory directive for the public and business entities to deposit the bulk of South Sudan pounds in their possession to licensed banks and to conduct transactions through licensed financial institutions.

The directive cited sections of the Anti-Money Laundering and Counter-Terrorist Financing Act, 2012, which empowers the agency to criminalize possession of illicit bulk cash and reporting large-cash transactions.

MP’s Criticism and Scepticism

Reacting to the order, Hon. Gai Mayen Luk, a member of the Transitional National Legislative Assembly, expressed scepticism over the practicality and effectiveness of the directive, citing past failures in the implementation of similar orders.

He emphasized the need for government officials to demonstrate transparency in handling public funds before enforcing such directives, highlighting the chronic shortage of cash in the local economy as a result of alleged embezzlement by high-ranking officials.

Lack of Confidence in Financial System

Hon. Mayen attributed the ineffectiveness of past policies to a lack of public confidence in the financial system, exacerbated by hyperinflation that diminishes the value of money kept in banks. He also raised concerns about the limited support for ordinary citizens in the banking sector.

Political Instability and Financial Behavior

The MP further criticized government officials for not leading by example and accused some of taking public funds abroad, contributing to the overall instability in the financial system. He warned that issuing directives without addressing systemic flaws will not yield the desired results.

Conclusion

In conclusion, Hon. Gai Mayen Luk’s call for the FIU to lead by example in combatting money laundering reflects broader concerns about the effectiveness of financial directives in South Sudan. Without addressing underlying issues of transparency, public confidence, and political stability, efforts to combat illicit financial activities may continue to face significant challenges.