FOLLOWING THE PROCEEDS OF CRIME IN CASH-BASED ECONOMY

A White Paper on Challenges of Investigators in Liberia’s (AML/CTF) Regime

GABRIEL W. BELLEPEA

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Table of Contents

Executive Summary ........................................................................................................................ 2

Introduction and Objective of the Paper ......................................................................................... 3

Methodology ................................................................................................................................... 5

Literature Review............................................................................................................................ 6

Liberia AML/CFT1 Environment ............................................................................ 6

Overview of Financial Crimes in Liberia ................................................................ 7

History of Financial Crimes Investigation and Following the Proceeds of Crimes

by LEA’s Investigators in Liberia............................................................................ 8

Analysis of LEAs’ Investigations of Financial Crimes and Charges/Indictments Data ............... 10

Challenges in Following the Proceeds of Crimes: Investigators’ Perspectives ............................ 11

Findings and Conclusion............................................................................................................... 14

Recommendations ......................................................................................................................... 15

REFERENCES ............................................................................................................................. 18

1 Anti-money laundering/combating the financing of terrorism

2

Executive Summary

The motivation of this paper is to discuss how financial crime investigations, especially the

component of the investigation that has to do with following the proceeds of crimes/money

laundering in Liberia, remained a constraint to Law Enforcement Authorities/Agency (LEAs). This

challenge is pronounced in a cash-based economy where almost all transactions are facilitated by

cash. Law enforcement’s investigation has primarily focused on the committed crime, referred to

as predicate offense, while investigation relating to ‘following proceeds of the crime’/money

laundering is neglected. ‘Following these proceeds of crime’ in LEAs’ investigations in order to

confiscate/seize and deny criminals from benefiting from their ill-gotten money is an essential

component of financial crime investigation by LEAs.

This paper intends to discover challenges LEAs face in following the proceeds of crimes in their

financial crime investigations and provide solutions to the identified challenges in Liberia

AML/CFT regime. This paper identified lack of technical knowledge/capacity of investigators;

lack of political will; lack of integrity of investigators; lack of coordination, cooperation and

collaboration among and between enforcement agencies; interference in investigations by superior

officers and weak institutions in Liberia’s AML/CFT system to be the major challenges

investigators face in following illicit proceeds in Liberia.

Through illicit financial outflow, “Liberia annually loss about 1 billion United States Dollars to

other continent.”2 Geebgae (2016) in his study: “Dynamics of Illicit Financial Flows from Liberia:

Country Case Study,”3 found that criminal activities such as tax invasion, corruption, bribery,

counterfeiting, drug trafficking, theft and mispricing as principal drivers to financial flow in

Liberia. These illicit outflows have the potential to reduce the country’s needed revenue, thereby

impeding the government’s national development agenda. Meanwhile, these criminal activities

continue to increase due in part to failure of investigators to follow these illicit proceeds and ensure

that perpetrators of these crimes are denied access to these funds.

2 Chairman of the High Level Panel on Illicit Financial Flows from Africa & former President of South Africa, His

Excellency (HE) Thabo Mbeki assertion during his visit in Liberia, 2014 3 Prof. Geegbae A. Geegbae study to determine the drivers of illicit financial outflow in Liberia, 2016.

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To address the findings of this paper, national authority/the President should establish an “Inter-

Agency Financial Crime Enforcement Task Force (IAFCETF),” charged to wage sustained and

aggressive, coordinated, collaborated and preventive determination to independently investigate

and prosecute financial crimes including illicit financial flows in Liberia. The task force shall

comprise of representatives from competent authorities and law enforcement agencies such as

(MOJ – the Solicitor General Office including the fifteen County Attorneys, FIU, LNP, NSA,

LACC, LRA, DEA, LIS) and regulatory authorities (Central Bank of Liberia’s (CBL) AML/CFT

Unit, National Lottery Authority’s (NLA) Supervisory/Enforcement Unit and Ministry of Land

Mine and Energy’s (MoLME) Supervisory/Enforcement Unit for precious stone and mental). The

compensation and operational budget of the task force should be performance-based, meaning the

more successful investigation, prosecution, asset recovery, forfeiture of crime proceeds and

assessment of monetary civil penalties, the more attractive the compensation and operational

budget. The Force should develop and adopt policies and practices to address the following:

technical training and capacity building of its investigators; soliciting adequate national budget to

support its financial crime investigations and prosecutions; doing background checks on its

financial crime investigators before recruitment and developing a robust standard operation

procedure (SOP) and an effective monitoring mechanism for compliance. Noncompliance should

warrant dismissal action and/or criminal investigation and prosecution, depending on the gravity

of the noncompliance. These recommendations, when effectively adopted and implemented,

would boost financial crime investigations, following the proceeds, prosecution of culprits and

forfeiture of properties/assets obtained therefrom.

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Introduction and Objective of the Paper

The component of financial crime investigation which has to do with following the proceeds of

crimes/money laundering and denying criminals from using ill-gotten funds has posed serious

challenge to the law enforcement community in Liberia. For the past decades, investigators in the

law enforcement community have concentrated their investigations on the crimes which generated

proceeds/profits referred to as ‘predicate crimes.’ The part of the investigation which deals with

the proceeds/funds generated from the commission of the crimes has blatantly been ignored. These

illicit proceeds have recorded an unprecedented amount in Liberia, and the proceeds leave Liberia

through ‘illicit financial flows’ using various medium. In a remark by the Chairman of the High

Level Panel on Illicit Financial Flows from Africa and former President of South Africa, His

Excellency (HE) Thabo Mbeki asserted that Africa loses about $50 billion a year to other

continents with Liberia accounting for about $1 billion annually of the total yearly loss through

illicit financial outflow. This illicit financial outflow is the result of criminal activities relating to

tax invasion, corruption, drug trafficking, counterfeiting, misinvoicing, terrorist financing, money

laundering, theft and bribery (Geegbae A. Geegbae report, 2016). This can be attributed in part to

the failure of investigators to follow the proceeds of crimes in their investigations in order to deny

perpetrators of their ill-gotten funds through seizure, confiscation and forfeiture.

Allowing these criminals to launder ill-gotten funds unconditionally has the propensity to

undermine national development efforts as well as undermine national and international efforts of

fighting money laundering and terrorist financing and, to a larger extent, peace and security. In his

keynote address on May 24, 2017, in the Cameroonian Capital Yaoundé, the President of the

African Organization of Public Accounts Committee (AFROPAC), Senator Edward Daggoseh,

asserted that financial crimes including tax invasion, corruption, minerals smuggling, sale of drugs

and trafficking of people, financing of organized crimes, etc., are major development impediment

in Africa, particularly Liberia.

Law enforcement’s investigation has primarily focused on the committed crime, referred to as

predicate offense, while investigation relating to following proceeds of the crime/money

laundering is neglected. Geebgae (2016) in his study: “Dynamics of Illicit Financial Flows from

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Liberia: Country Case Study,”4 found that criminal activities such as tax invasion, corruption,

bribery, counterfeiting, drug trafficking, theft, and mispricing are principal drivers to financial

flow in Liberia.. Thus, investigations, especially the component that has to do with following the

proceeds of crimes/money laundering in Liberia, remained a constraint to law enforcement

authorities/agencies, hence this study will elicit key policy issues for mitigating the problem.

This papers aims to ascertain challenges the law enforcement community faces in following

proceeds of crimes’in its investigations as well as provide mitigating solutions to the challenges

identified.

Methodology

In identifying challenges enforcement communities face in following the proceeds of crimes in

Liberia, the author of this paper reviewed relevant documents relating to financial crime

investigations in Liberia as well as following the proceeds of crimes. Additionally, the study

reviewed the history of commission of various financial crimes in Liberia to gauge the trend in

these crimes. More specifically, this paper reviewed the trend in illicit financial outflow from

Liberia to ascertain revenue loss as the result of following the proceeds of crimes in Liberia. This

paper also reviewed data relating to financial crime investigations and charges/indictments brought

against suspects. Data period considered is 2011 to 2016. The review of these data provided the

insight on whether or not investigators’ charges/indictments have ever considered money

laundering charges which is synonymous to following the proceeds of crimes. The paper assumed

that for the period spanning five years and even before this data period, investigators in Liberia

LEAs have not followed the proceeds of crimes. Moreover, the author of the paper interviewed

financial crime investigators at Liberia National Police (LNP), Liberia Anti-Corruption

Commission (LACC), Ministry of Justice and National Security Agency (NSA) so as to ascertain

the challenges these investigators face in their financial crime investigations as well as following

the proceeds thereof. This paper assumed that investigators are faced with challenges in their

following the proceeds of crimes, something which has restricted their investigation to the crime

committed.

4 Prof. Geegbae A. Geegbae study to determine the drivers of illicit financial outflow in Liberia, 2016.

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Literature Review

The literature review is based on review of several documents - Liberia AML/CFT environment,

overview of financial crimes in Liberia, history of financial crimes investigation and following the

proceeds of crimes by LEAs investigators in Liberia. These documents were chosen in order to

give more insight as it relates to trends in commissions of financial crimes, investigations of these

crimes and following the proceeds of crimes in Liberia, as well as requirements set forth by FATF.5

Recommendations on the investigation of predicate offenses include following the proceeds of the

crime/money laundering.

Liberia AML/CFT environment

Liberia is a member of the Inter-Governmental Group against Money Laundering in West Africa

(GIABA). It is a specialized institution established by the Economic Community of West African

States (ECOWAS) that is tasked with the responsibility of ensuring member states comply with

Financial Action Task Force (FATF) standards and best practices. Liberia accordingly subscribed

to the fight against money laundering and terrorist financing formally known as anti-money

laundering and countering of terrorist financing (AML/CFT) in 2002. This was demonstrated by

the passage of the Prevention of Money Laundering Law (PMLL) by the Liberia National

Legislature and approval on January 8, 2002. Although, the PMLL was inadequate to address the

then FATF 40 + 9 special recommendations, and its implementation was considered to be weak,

the law set the basis to fight money laundering and terrorist financing in Liberia (GIABA Mutual

Evaluation Report, May 6, 2011).

The PMLL and other laws in Liberia identified the following conducts as predicate offenses of

money laundering: illicit traffic in stolen and other goods, corruption, bribery, fraud, counterfeiting

of currency, counterfeiting and piracy of products, environmental crime, murder and grievous body

injury, kidnapping, illegal restraint and hostage taking, robbery, theft, smuggling, extortion,

forgery, insider dealing and market manipulation, terrorism and terrorist financing, and trafficking

human beings. Law enforcement investigators are required to follow the proceeds of these

5 Financial action Task Force

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predicate offenses for the purpose of seizure, forfeiture and denial to criminals from benefiting

from these proceeds.

In its first round of mutual evaluation, GIABA assessed Liberia’s compliance with FATF

recommendations in November 2010. The evaluation used the FATF 40 + 9 special

recommendations to assess the country. Liberia AML/FT legal framework was assessed on the

basis of the Prevention of Money Laundering Law and other laws as well as other regulations. The

mutual evaluation report which was published in May 2011 identified significant deficiencies in

the Liberia AML/CFT regime. Among others and particularly, the report noted that following the

proceeds of crime/money laundering investigations have not been conducted by LEA’s

investigators in Liberia. This was attributed to lack of structure, resources (both human and

financial), integrity standards and training (GIABA Mutual Evaluation Report on Liberia, 2011, #

320). GIABA Plenary therefore placed Liberia on the regular expedited follow-up regime (1 year

reporting) and requested Liberia to report progress to Plenary in May 2012. Liberia has made 7

follow-up reports to GIABA Plenary with little progress on these deficiencies. Currently the

Liberia AML/CFT regime is on the enhanced follow-up regime (6 months reporting) due to, among

other things, low levels of LEA investigations of predicate offenses and following the proceeds of

these crimes, low levels of prosecution of these crimes, lack of convictions, seizure/confiscation,

forfeiture of proceeds of crimes, etc.

As a result of the recommendations from the evaluation, in 2013, Liberia enacted seven pieces of

AML/CFT related legislations, including AML/CFT Act, Financial Intelligence Unit Act, and the

Fraud Act, among others. These acts aimed to address some of the issues recommended in the

report.

Overview of Financial Crimes in Liberia

Financial crimes in Liberia are on the rise and they dominate the entire crime statistics. Financial

crimes as discussed in this paper refer to unlawful conducts that generate proceeds or profits. They

are crimes against property which are carried out by individuals, corporations or organized crime

groups (Wikipedia, the free encyclopedia).

More importantly, the seriousness of the commission of financial crimes in Liberia can be seen

from the proceeds which are generated from the crimes and the illicit outflow. The Chairman of

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the High Level Panel on Illicit Financial Flows from Africa and former President of South Africa,

Thabo Mbeki, during his high-level visit in Liberia in 2013 asserted that Africa loses about $50

billion a year to other continents with Liberia accounting for about $1 billion annually of the total

yearly loss through illicit financial outflow. This amount is generated from commissions of various

financial crimes in Liberia. Geegbae (2016) determined the driver of illicit financial flow in Liberia

and indicated that illicit financial outflow from Liberia is a result of criminal activities associated

with drug trafficking, corruption, tax invasion, bribery, counterfeiting, money laundering, terrorist

financing, theft, mis-invoicing, illegal mining, and human trafficking, among others (Dynamics of

Illicit Financial Flows from Liberia, 2016).

Table 1.1 in the Appendix presents financial crimes committed and investigated by Liberia

National Police (LNP) covering the period 2012 to 2016 (see Appendix 1, Table 1.1). The crime

statistics are dominated by armed robbery, auto theft, bribery, burglary counterfeiting, human

trafficking, kidnapping, robbery, forgery, fraud, economic sabotage, drug trafficking property

theft, etc. It is important to note that the crimes reported and investigated by LNP did not include

financial crimes investigated by other enforcement authorities (LACC, LRA, NSA, DEA). The

commission of these financial crimes generates millions to criminals. When left unchecked, it has

the propensity to undermine macroeconomic stability, national development effort, as well as

national security.

Chart 1.1 shows a trend analysis of financial crimes investigated by LNP for the period 2012 to

2016. The chart reveals that in 2013 there was an overall increase in financial crimes and

investigation to seven thousand six hundred eight crimes, while the lowest recorded in 2012 stood

at six thousand six hundred twenty-eight crimes. Property theft, armed robbery, burglary, robbery

and drug trafficking investigations recorded the highest throughout the period.

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History of Financial Crimes Investigation and Following the Proceeds of Crimes by LEAs

Investigators in Liberia

Financial crimes investigations by law enforcement agencies (LEAs) in Liberia for the period

spanning 15 years has focused on the crime committed and not the proceeds generated from crimes.

Also, LEAs investigators’ subsequent charges relating to financial crime so investigations have

considered the offenses and have not considered money laundering charges which could ensure

forfeiture/confiscation/asset recovery upon conviction of defenders by court of competent

jurisdiction. Hence, following the proceeds of crimes by investigators in Liberia for the period

spanning 15 years has been disregarded (GIABA Mutual evaluation Report, 2011). This can be

attributed to so many challenges (lack of technical knowledge and capacity to following proceeds

of crimes, low level of coordination, cooperation among and between LEAs, weak enforcement

institutions, increase in illicit financial flows, etc.) which this paper aims to discover.

In the Liberia AML/CFT legal framework, the primary LEAs tasked with the responsibilities to

investigate various financial crimes include Liberia National Police (LNP), which investigates all

types of financial and non-financial crimes; National Security Agencies (NSA), which investigates

threats/crimes relating to national security; Liberia Anti-Corruption Commission, (LACC), which

investigates corruption-related crimes; Drug Enforcement Agency of Liberia (DEA), which

investigates drug-related cases; and Liberia Immigration Service, (LIS), which investigates

0%10%20%30%40%50%60%70%80%90%

100%

Chart 1 .1:Trend Analys is of F inancia l Cr imes Invest igated by LNP, 2012 - 2016

Series1 Series2 Series3 Series4 Series5

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immigration-related crimes. These agencies conduct their respective investigations and send their

recommended charges to the Ministry of Justice for Prosecution.

Analysis of LEAs’ Investigations of Financial Crimes and Charges/Indictments Data

In an attempt to understand the general level of investigators’ understanding in following the

proceeds of crime in their financial crime investigations, the paper obtained and analyzed

secondary data relating to LEA’s investigations of financial crimes and charges therefrom for the

period of 2011 to 2016. The data source used in the analysis is LNP’s crime investigation and

charges report. The data was used because LNP has the legal responsibility to investigate all

criminal offenses and bring charges thereof. It therefore is the largest investigation arm of

government covering the entire country.

During the period covering 2012 to 2016, the Criminal Investigation Division (CID) of the Liberia

National Police reported a total of 35,000 charges following an investigation of various financial

crimes across Liberia. The crimes included, among others, bribery, theft of property, fraud,

forgery, possession of narcotic drugs, counterfeiting of currency, corruption, armed robbery,

economic sabotage, etc. Of this total investigation and subsequent charges, 6,628 charges were

levied in 2012; while 7,608 charges were levied in 2013; 7,344 charges in 2014; 6,642 charges in

2015 and 6,778 charges were imposed in 2016 following the conclusion of various financial crimes

investigations across the country (see Appendix 1, Table 1.2, page 19).

The graphic chart below 1.2 represents charges levied by LNP following its investigations of

various financial crimes committed covering the period 2012 to 2016. Charges relating to theft of

property recorded 4,953 in 2012, 5,765 in 2013, 5,580 in 2014, 5,032 in 2015 and 5,271 in 2016;

this was followed by charges for robbery, burglary, armed robbery, and auto theft, among others.

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However, these investigations and subsequent charges did not consider following the proceeds of

crimes and or money laundering charges, which poses significant threat and vulnerability to the

fight against financial and economic crimes, illicit financial flows and money laundering.

Moreover, analysis of primary data obtained through interview of investigators across the various

LEA community (LACC, NSA, LRA, etc) revealed that, during the period 2012 to 2016,

respondents’ financial crime investigations and subsequent charges did not cover following the

proceeds of the financial crimes investigated, and therefore following the proceeds of crime/money

laundering charges were not levied.

The data from the LEA community covering the period 2012 to 2016 clearly indicated that

investigations of various financial crimes in Liberia have not targeted following the proceeds of

the crimes, but rather the crimes so committed/predicate crimes.

Challenges in following the proceeds of crimes: investigators’ perspectives

In order to better understand challenges investigators encounter in following the proceeds of

crimes in their financial crime investigations, field surveys, in-depth interviews and consultations

were carried out. The effort targeted senior, junior and low-level investigators across the LEA

community in Liberia (LNP, LACC, NSA, LRA and MOJ).

295

15 1797 17

10

19 19712

0

3

268

41 4953

0

227

53

1

97642 6

41 291 37

1

1

104

61 5765

2

248

60

121008

356 32

198 25

3

5 77

515580 4

16362 0

958 16 925

223 27

0

1 5568 5032

3170 66 5 751 14 2 24 290 30 6 2 75 71 5271 1

Chart 1.2: LNP Charges from Investigations of Financial Crimes (2012 - 2016)

Series1 Series2 Series3 Series4 Series5

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While conducting the survey, respondents were requested to identify four challenges which hinder

following the proceeds of crime’ in financial crime investigation in Liberia. Respondent’s views

reflected the following:

1. Lack of Technical Knowledge/Capacity: All respondents identified lack of technical

knowledge/capacity as one of the major challenges in following proceeds of crimes in their

financial crime investigations in Liberia. Investigators’ technical knowledge in money

laundering and its effects on society, various platform/medium criminals used to launder

their proceeds, mechanisms used to launder illegal funds, including financial institutions

(bank, insurance, mobile money, microfinance, forex bureaus) and designated non-

financial business and professionals (DNFBPs: gaming, casinos, real estate, precious

stones and Metals, etc.), techniques criminals use to launder their ill-gotten funds, linking

predicate crimes to the proceeds, etc. is limited and low. There is also a shortage of

technical and human capacity to deal with various crimes perpetuated by sophisticated

organized criminal networks as well as shell companies and individuals whose intent is to

continue propagating their illegal activities thereby denying society the much-needed

revenue for national development.

2. Lack of Political Will: All respondents identified political will as the second major

challenge in their attempt to following proceeds of crimes in Liberia. The willingness of

policy makers/decision makers to adequately support financial crimes investigations and

following the proceeds of crimes as well as ensuring the prosecution of culprits was

inadequate. This, according to respondents, is manifested in low budgetary support

including salary of investigators as well as lock of logistics (vehicles, computer, etc.) and

lack of infrastructure (databases, internet). For instance, a major financial crime

investigation section at the LNP does not have a vehicle which could be used for collection

of additional information on suspects and following the crime proceeds. The law

enforcement and regulatory databases are fragmented and mostly stored manually; most of

these databases are not electronic and web-based. Additionally, there is not a centralized-

web-based national database which captures criminal investigations, intelligence, criminal

records, etc.

3. Lack of Integrity of Investigators: The issue of integrity of investigators was identified

as the third major challenge to law enforcement community. Almost all respondents

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asserted that due to the lack of incentives coupled with low salary across the enforcement

landscape, many investigators collude with perpetrators of financial crimes to compromise

the investigation conclusion and following the proceeds of crimes. Interviewees disclosed

that most law enforcement agency heads take bribes from suspects while investigation into

financial crime is underway. Ultimately, when the investigation report is submitted to the

head of this agency who has initially taken a bribe from the suspect, the report and its

recommendations automatically goes “under the carpet.”

4. Coordination, Cooperation and Collaboration among LEAs: Another essential

challenge respondents alluded to was lack of coordination, cooperation and collaboration

among and between enforcement agencies. Most respondents indicated that coordination,

cooperation and collaboration in financial crime investigations and following the proceeds

of crimes is very low. Information sharing across the enforcement community is limited;

even parallel investigation of financial crimes and following the proceeds of crimes is

impossible as well. This tends to impede effort in following the proceeds of crimes.

5. Interference in Investigation by Superior: Identified by most respondents as a challenge

in following the proceeds of crimes is interference in financial investigation by superior

officers of law enforcement agencies. Respondents stated that most often, investigator’s

decisions/recommendations to levy charges have been manipulated by their superiors, and

any resistance from the investigators to do otherwise leads to suspension or change of

assignment. As pointed out in count 3, interviewees alluded that this manipulation of

investigator’s decisions/recommendations is due in part to bribes received by the superior

officers. Furthermore, interviewees indicated that in some cases, this manipulation is due

to vested high-power/authority’s interest in the investigation where pressing any charge

would drag that high-power/authority to court of competent jurisdiction.

6. Weak institutions: Weak institutions, especially enforcement institutions, were

considered as one of the challenges in following criminal proceeds. Respondents asserted

that almost all enforcement institutions do not have the institutional will to follow criminal

ill-gotten money in their financial crime investigations. This, according to respondents and

interviewees, is attributed in part to the involvement in corruption of top institutional

officials operating at different levels in the institution. Professor Geegbae A. Geegbae also

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came to the same conclusion in his attempt to identify drivers of illicit financial outflow in

Liberia.

The above challenges have the tendency to demotivate investigators in following the proceeds of

crimes.

Findings and Conclusion

Investigators from the law enforcement landscape in Liberia have concentrated their investigations

on predicate crimes and neglected the aspect of the investigation which follows crime proceeds. It

was assumed that investigators dealing with financial crimes encounter challenges in following

the proceeds of crimes. This paper goal was to identify challenges investigators face in following

proceeds in their investigation of predicate crimes. The paper relied on secondary and primary

data. The secondary data were sourced from government official statistics and other international

data on Liberia, while the primary data were obtained from an opinion survey instrument

administered to various stakeholders in the enforcement community, consultation, in-depth

interviews involving professionals and government officials, etc.

The paper finds that investigators in the enforcement landscape in Liberia are confronted with

various challenges in their attempt to follow crime proceeds in financial crime investigations. The

identified challenges include lack of technical knowledge/capacity of investigators, lack of

political will, lack of integrity of investigators, lack of coordination, cooperation and collaboration

amongst and between enforcement agencies, interference in investigation by superior officers and

weak institutions in the Liberia anti-money laundering/countering the financing of terrorist

(AML/CFT) regime.

In conclusion, the paper has analyzed the challenges of financial crime investigations relating to

financial crimes in order to deny perpetrators access to funds as a vehicle to continue the

commission of crimes. This study is motivated by the fact that the financial crime investigation,

following the proceeds of crimes has been neglected by investigators in Liberia for several years.

Based on a review of literature relating to Liberia and analysis of data from the LNP, the incident

of financial crimes (tax invasion, corruption, fraud, money laundering, counterfeiting of

currencies, human trafficking, drug trafficking, etc.) has increased as well as the proceeds

generated therefrom. These illicit ill-generated funds flow out of Liberia through various means,

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thereby denying Liberian people the needed revenue to address government development agenda.

When left unchecked, it has the propensity to undermine national development effort,

macroeconomic stability as well as risk national security. This pattern of investigators not

including/going after proceed of crimes in financial crime investigations has the proclivity to

facilitate illicit financial flow. When criminals get away with their ill-gotten proceeds without law

enforcement’s punitive actions to deny them property assets (funds and other asset), it induces

criminals to continue committing financial crimes and enhancing their network. It also has the

tendency to undermine national, regional and global effort to fight money laundering and terrorist

financing. Investigators in the enforcement community are therefore encourage to take seriously

the aspect of their financial crime investigations which deals with following the proceeds of

crimes. Equally, policy decision makers are admonished to address challenges the enforcement

community faces in following the proceeds of criminal conducts.

Recommendations

In an attempt to address the identified challenges enforcement authorities face in following

illicit-criminal proceeds, the following recommendations are advised:

1. A multi-agency financial crime enforcement task force referred to as “Inter-Agency

Financial Crime Enforcement Task Force (IAFCETF)” be established by national

authority/the President. The IAFCEF should be tasked to wage sustained and aggressive,

coordinated, collaborated and preventive determination to independently investigate and

prosecute financial crimes including illicit financial flows in Liberia. The Task Force shall

comprise representatives from competent authority and law enforcement agencies (MOJ –

the Solicitor General Office including the fifteen County Attorneys, FIU, LNP, NSA,

LACC, LRA, DEA, LIS) and regulatory authorities (Central Bank of Liberia (CBL)

AML/CFT Unit, National Lottery Authority (NLA) Supervisory/Enforcement Unit and

Ministry of Land Mine and Energy (MoLME) Supervisory/Enforcement Unit for precious

stone and mental). Specifically, in its financial crime investigation and prosecution,

emphasis should be placed on following the proceeds of crimes, seizure, assert recovery,

forfeiture. Additionally the task force should conduct investigations emanating from

violations of major AML/CFT law and regulations and appropriately levying civil money

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penalty assessments against violating entities/institutions that willingly consent to such

action.

The compensation and operational budget for the task force should be performance-based,

meaning the more investigation, successful prosecution, asset recovery, forfeiture of crime

proceeds and assessment of monetary civil penalties, the more attractive compensation and

operational budget. For instance, a 10 to 15 percent bonus should be paid to the task force

whenever its investigation and prosecution recovers property and/or income/revenue for

the government. This percentage should also apply the task force civil monetary penalty

assessment.

The authority of the task force and national authority should consider the recommendations

below as the task force effectively executes its responsibilities:

A. Ensure that the technical knowledge and capacities of investigators are enhanced.

This can be done by providing requisite technical trainings relating to financial

crime investigation and prosecution techniques; money laundering investigation

and prosecution techniques; investigation and prosecution techniques relating to

seizure, confiscation, asset recovery, forfeiture through civil proceedings etc.

specifically, the technical training should consider Liberia’s AML/CFT legal and

regulatory framework; understanding money laundering techniques and linking

money laundering offense to the predicate offense, etc. The task force capacity

building effort should include Association of Certified Anti Money Laundering

Specialists (ACAMS) the Certified Anti-Money Laundering Specialist (CAMS)

designation; the Certified Anti-Money Laundering Specialist–Financial Crime

Investigation (CAMS-FCI) designation and the Certified Anti-Money Laundering

Specialist-AUDIT (CAMS-AUDIT) designation as well as the Certified Fraud

Examiner certification. Additionally, the task force authority should support its

investigators in graduate study in the field of financial crime investigation and

compliance management, cybercrime and forensic investigation, etc. These

technical training and capacity-building efforts would that the task force has the

requisite technical and analytical skills to aggressively investigate and prosecute

perpetrators of financial crimes and other transnational organized crime groups.

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B. National authority is encouraged to provide an adequate operational budget to

support the task force to enable it to execute its responsibilities. Adequate budgetary

financial support is very critical to ensuring the task force effectively and efficiently

perform its duties. Aggressive and proactive financial crime investigation and

prosecution by the task force has the tendency to generate additional revenue for

national government through asset recovery, forfeiture and civil monetary penalty

assessment. This depends on adequate operational budget support to the force.

C. To ensure integrity and address the issue of corruption in the task force, the force

authority is encouraged to do background checks for its investigators before

recruitment. The force authority should additionally develop a robust standard

operation procedure (SOP) and develop an effective monitoring mechanism for

compliance. Noncompliance should warrant dismissal action and/or criminal

investigation and prosecution, depending of the gravity of the noncompliance. This

would, to some extent, address the issue of corruption and ensure integrity

D. The issue of coordination, cooperation and collaboration is addressed in the task

force as the force is interagency-based, comprising of representatives from all

relevant competent authorities, law enforcement agencies and regulatory

authorities. The task force is enjoined to ensure coordination, cooperation and

collaboration in financial crime investigation and prosecution. Specifically,

intelligence, criminal data records and other relevant information sharing in

financial crime investigation and prosecution is crucial in disorganizing crime

networks and denying them access to their ill-gotten funds.

The challenges identified in this paper cut across the enforcement community in Liberia. An

integrated approach to resolve these challenges is therefore required to address the constraints law

enforcement faces in investigation of financial crime and following illicit proceeds. The

establishment and provision of operational support to the Interagency Financial Crime

Enforcement Task Force would counter the identified challenges and boost financial crime

investigations, following the proceeds, prosecution of culprits and forfeiture of properties/assets

obtained therefrom.

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Reference

African Organization of Public Accounts Committee (AFROPAC) Conference, 2017.

http://frontpageafricaonline.com/index.php/news/4236-illicit-financial-flows-impedes-

development-afropac-boss

Boyce, J.K. and Ndikumana, L. 2012. Capital flight from Sub-Saharan African countries:

updated estimates, 1970-2010. Political Economy research Institute, University of

Massachusetts Amherst

Financial Action Task Force (FATF) Recommendation, 2012.

http://www.giaba.org/media/f/431_FATF%20Recommendations%20Eng.pdf

Financial Crime Investigation. https://www.int-comp.org/careers/a-career-in-financial-

crime-prevention/what-is-financial-crime/

Financial Investigation. https://en.wikipedia.org/wiki/Financial_crimes

Geegbae A. Geegbae, 2016. Dynamics of Illicit Financial Flows from Liberia: Country

Case Study.

GIABA Mutual Evaluation Report on Liberia, 2011,

http://www.giaba.org/media/f/284_GIABA%20DETAILED%20MUTUAL%20EVALU

ATION%20%20%20%20REPORT%20%20ON%20THE%20REPUBLIC%20OF%20LI

BERIA%20-2011.pdf

Republic of Liberia (2002). The Prevention of Money Laundering Law (PMLL)

Republic of Liberia (2012). Liberia National Police Crime Statistics report.

Republic of Liberia (2013). Liberia National Police Crime Statistics report.

Republic of Liberia (2014). Liberia National Police Crime Statistics report.

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Republic of Liberia (2016). Liberia National Police Crime Statistics report.

19

Appendix 1

Table 1.1: Financial Crimes Investigated by LNP (2012 – 2016)

Crimes Committed 2012 2013 2014 2015 2016

Armed Robbery 295 227 248 163 170

Auto Theft 15 53 60 62 66

Bribery 1 1 12 0 5

Burglary 797 976 1008 958 751

Counterfeiting 17 42 35 16 14

Human trafficking 10 6 6 9 2

Kidnapping 19 41 32 25 24

Robbery 197 291 198 223 290

Forgery 12 37 25 27 30

Fraud 0 1 3 0 6

Economic Sabotage 3 1 5 1 2

Drug trafficking 268 104 77 55 75

Corruption 41 61 51 68 71

Theft of Property 4953 5765 5580 5032 5271

Illicit mining 0 2 4 3 1

TOTAL 6628 7608 7344 6642 6778

Source: Liberia National Police

0%10%20%30%40%50%60%70%80%90%

100%

Chart 1 .1 :Trend Analys is of F inancia l cr imes Invest igated by LNP, 2012 - 2016

Series1 Series2 Series3 Series4 Series5

20

Appendix 2

Table 1.2: LNP Charges from Investigation of Financial Crimes (2012 – 2016)

Police Charges from Investigation 2012 2013 2014 2015 2016

Armed Robbery 295 227 248 163 170

Auto Theft 15 53 60 62 66

Bribery 1 1 12 0 5

Burglary 797 976 1008 958 751

Counterfeiting 17 42 35 16 14

Human trafficking 10 6 6 9 2

Kidnapping 19 41 32 25 24

Robbery 197 291 198 223 290

Forgery 12 37 25 27 30

Fraud 0 1 3 0 6

Economic Sabotage 3 1 5 1 2

Drug trafficking 268 104 77 55 75

Corruption 41 61 51 68 71

Theft of Property 4953 5765 5580 5032 5271

Illicit mining 0 2 4 3 1

TOTAL 6628 7608 7344 6642 6778 Source: Liberia National Police

295

15 1797 17

10

19 19712

0

3

268

41 4953

0

227

53

1

97642 6

41 291 37

1

1

104

61 5765

2

248

60

121008

356 32

198 25

3

5 77

515580 4

16362 0

958 16 925

223 27

0

1 5568 5032

3170 66 5 751 14 2 24 290 30 6 2 75 71 5271 1

Chart 1.2: LNP Charges from Investigations of Financial Crimes (2012 - 2016

Series1 Series2 Series3 Series4 Series5