Swaziland

Last Updated: 26/03/2013


CENTRAL AUTHORITY FOR REPORTING

Central Bank of Swaziland (CBS)

Section 19 of the Money Laundering and Financing of Terrorism (Prevention) Act, 2011 (MLFTPA) provides for the establishment of Swaziland Financial Intelligence Unit (SFIU).

It has not been established. Its function will be to receive, request, analyse and disseminate to competent authorities disclosures of financial information in order to counter money laundering and financing of terrorism.


OTHER ANTI-MONEY LAUNDERING REGULATOR(S)


ARE LAWYERS COVERED BY ANTI-MONEY LAUNDERING LEGISLATION?

Yes. Lawyers, notaries, conveyancers and other independent legal professionals are listed as “accountable institutions” in Section 2of the MLFTPA.


LIST THE LAWS REGARDING ANTI-MONEY LAUNDERING, INDICATING WHICH LAWS ARE APPLICABLE TO LAWYERS.

• Financial Institutions Act 2005
• Money Laundering and Financing of Terrorism (Prevention) Act 2011 (MLFTPA) – applicable to lawyers


ARE VISITING LAWYERS SUBJECT TO LOCAL LAWS REGARDING ANTI-MONEY LAUNDERING, AND, IF SO, TO WHAT EXTENT?

There are no specific provisions in this respect.  


LIST ANY MONEY LAUNDERING GUIDANCE FOR LAWYERS (FOR EXAMPLE, LAW SOCIETY OR BAR ASSOCIATION GUIDELINES) CURRENTLY IN PLACE.

Lawyers, notaries and other independent legal professionals in Swaziland are regulated by the Law Society of Swaziland (LSS). The LSS reports to the Ministry of Justice. The regulatory framework governing lawyers in Swaziland includes:

  1. Legal Practitioners Act 1964
  2. Legal Practitioners (Disciplinary Proceedings) Regulations 1989
  3. The Law Society of Swaziland By-Laws 1992

IS THE LAW SOCIETY/BAR ASSOCIATION INVOLVED IN SUPERVISING OR ENFORCING COMPLIANCE WITH ANTI-MONEY LAUNDERING REGULATIONS?

Once the institutions established by the MLFTPA are operational, the Law Society will be involved at policy formation level.

Section 38 of the MLFTPA provides for the establishment of a Task Force which shall be a policy making organ for anti-money laundering and counter financing terrorism in Swaziland.


DESCRIBE CLIENT DUE DILIGENCE REQUIREMENTS, INCLUDING WHEN IT MUST BE UNDERTAKEN BY LAWYERS.

In terms of Section 11 (3)  of the MLFTPA, accountable institutions are required to monitor their business relationships and transactions undertaken to ensure that no suspicious activities take place.

Lawyers are under no obligation to conduct client due diligence measures.


DOES YOUR COUNTRY FOLLOW A RISK-BASED APPROACH TO CLIENT DUE DILIGENCE BY LAWYERS?

No.


ARE THERE ENHANCED DUE DILIGENCE MEASURES FOR CERTAIN TYPES OF CLIENTS, FOR EXAMPLE, POLITICALLY EXPOSED PERSONS?

No.


ARE THERE SIMPLIFIED DUE DILIGENCE MEASURES FOR CERTAIN TYPES OF CLIENTS, FOR EXAMPLE, LISTED COMPANIES?

No.


ARE LAWYERS PERMITTED TO RELY ON THIRD PARTY DUE DILIGENCE? IF YES, PLEASE DESCRIBE.

No.  


WHEN IS A LAWYER UNDER AN OBLIGATION TO REPORT SUSPICIOUS TRANSACTIONS?

As an accountable institution, lawyers are under an obligation to report suspicious transactions to the SFIU if they suspect or have reasonable grounds to suspect that:

  1. Any transaction or attempted transaction may be related to the commission of an unlawful activity, a money laundering offence or an offence of financing terrorism;
  2. Information that may be –
    1. Relevant to an act preparatory to an offence of financing terrorism;
    2. Relevant to an investigation or prosecution of a person or persons for an unlawful activity, a money laundering offence or an offence of financing believe that   do not have any obligation to report suspicious transactions under the present regulatory framework. 

DOES ATTORNEY/CLIENT PRIVILEGE AND/OR DUTIES OF CONFIDENTIALITY PROVIDE A DEFENCE OR PARTIAL/TOTAL EXCEPTION TO THE REQUIREMENT TO REPORT SUSPICIOUS TRANSACTIONS?

N/A. 


DOES LOCAL LAW PROVIDE ANY CRIMINAL AND/OR CIVIL INDEMNITY TO A LAWYER WHO HAS REPORTED A SUSPICIOUS TRANSACTION?

N/A.


ONCE A SUSPICIOUS TRANSACTION REPORT HAS BEEN FILED, IS A LAWYER ALLOWED TO PROCEED WITH THE LEGAL ADVICE/TRANSACTION, AND, IF SO, MUST CONSENT FROM AUTHORITIES BE OBTAINED FIRST?

N/A.


IS THERE A TIPPING-OFF PROHIBITION? IF YES, PLEASE DESCRIBE.

Yes.

Section 14 of the MLFTPA prohibits the disclosure by any person or institution of reports made to the SFIU or that the accountable institution has formed a suspicion in relation to a transaction or any other information from which the person to whom the information is disclosed could reasonably be expected to infer that a suspicion has been formed or that a report has been or may be made.


DESCRIBE ANY RESTRICTIONS ON ACCEPTING A NEW CLIENT.

N/A.


ARE THERE ONGOING MONITORING REQUIREMENTS FOR EXISTING CLIENTS? IF YES, PLEASE DESCRIBE.

N/A.


DESCRIBE ANY OTHER WAYS IN WHICH LAWYERS ARE AFFECTED BY ANTI-MONEY LAUNDERING LEGISLATION.

N/A. 


HAVE LAWYERS IN YOUR JURISDICTION BEEN IMPLICATED IN MONEY LAUNDERING, INCLUDING ANY TYPE OF COMPLAINT, ARREST OR PROSECUTION?

No information available.


HAS THE FINANCIAL ACTION TASK FORCE (FATF) CONDUCTED A MUTUAL EVALUATION OF THIS COUNTRY, AND, IF SO, WHAT WERE THE FINDINGS CONCERNING LAWYERS’ COMPLIANCE WITH THE FATF 40+9 RECOMMENDATIONS?

Yes.

Swaziland is a member of the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG). The ESAAMLG conducted an evaluation of Swaziland’s AML/CFT framework in February 2010 and adopted a mutual evaluation report in September 2011.

Swaziland has been rated non-compliant with most of the FATF recommendations. The ratings for compliance with FATF recommendations with respect to DNFBPs are as follows:

  • Recommendation 12 (Customer Due Diligence): Non-Complaint
  • Recommendation 16 (Suspicious Transaction Reporting): Non-Complaint
  • Recommendation 24, 25 (Regulation, Supervision and Monitoring and Sanctions): Non-Complaint
  • Recommendation 20 (Other non-financial businesses and professions & Morden- secure techniques): Non-Complaint

This mutual evaluation report has made the following recommendations with respect to DNFBPs (summarised):

  • Establishment of a FIU;
  • Passing of the Money Laundering and Financing of Terrorism (Prevention) Bill 2009 to extend AML/CFT obligations to DNFBPs consistent with FATF standards;
  • Extending the scope of the current AML/CFT regulatory framework to DNFBPs in a manner consistent with the FATF recommendations;
  • Designating competent authorities with adequate responsibility for ensuring AML/CFT regulatory compliance by DNFBPs other than real estate agents;
  • Issue guidelines to all DNFBPs for implementing AML/CFT procedures;
  • Appointment of designated competent authorities for AML/CFT regulation and supervision for other DNFBPs like lawyers.

Information provided by:

Knox Nxumalo

kmnxumalo@robinsonbertram.law.sz

Gabsile Maseko

gabsilem@robinsonbertram.law.sz

Sources:

 

Sabelo Mamba, ‘Anti-Money Laundering Committee appointed’ The Swazi Observer (Mbabane, November 7, 2012)

<http://www.observer.org.sz/index.php?news=45022> accessed 10 December 2012

Winile Masinga, ‘SRA to fight Money Laundering’ The Swazi Observer (Mbabane, October 25, 2012)

<http://www.observer.org.sz/index.php?news=44517> accessed 10 December 2012

Eastern Southern Africa Anti-Money Laundering Group, Mutual Evaluation Report, dated February 2010

<http://www.esaamlg.org/userfiles/Detailed-MER-for-the-Kingdom-of-Swaziland(1).pdf> accessed 10 December 2012


 

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