Anti-Money Laundering Act 2003

Anti-Money Laundering Act 2003: Practical Guide for Businesses, Investors and the Public

Introduction

The Gambia Anti Money Laundering Act 2003 was enacted to prevent the use of the Gambian financial system for the concealment, transfer and legitimisation of proceeds derived from crime. The Act imposes obligations on financial institutions, creates money laundering offences, establishes supervisory and reporting mechanisms, and provides for the freezing and forfeiture of criminal property.

This guide explains the key provisions of the Act in practical language for businesses, investors, financial institutions, company directors and members of the public.

1. Who Must Comply with the Act?

Financial Institutions

The Act applies to a broad range of entities described as "financial institutions", including:

• Banks and financial businesses.

• Money transfer and exchange services.

• Real estate businesses.

• Insurance companies and intermediaries.

• Securities dealers and brokers.

• Credit unions and building societies.

• Casinos, lotteries and gambling houses.

• Trust businesses.

• Money lending and pawnbroking businesses. Schedule 1.

Why this Matters

Many businesses do not realise they fall within the statutory definition of a financial institution. Real estate agencies, casinos, money transfer operators and insurance intermediaries are subject to anti-money laundering obligations just as banks are. Schedule 1.

2. Customer Due Diligence (Know Your Customer)

Identification of Customers

Section 3

Financial institutions must take reasonable measures to verify the identity of customers before:

• Establishing a business relationship; or

• Conducting transactions. s.3(1).

Individual Customers

An individual must provide:

• An official identification document bearing a photograph; and

• Recent proof of address; or

• Identification by an existing customer of the institution. s.3(2)(a).

Corporate Customers

Companies must provide:

• A certificate of incorporation; and

• Other official documentation confirming their existence. s.3(2)(b).

Beneficial Ownership

Where a person is acting on behalf of another person, the institution must identify the true beneficial owner behind the transaction. ss.3(6)-(7).

Practical Example

If a company director opens an account on behalf of a company, the institution must identify:

• The individual conducting the transaction.

• The company.

• The persons ultimately benefiting from the transaction where relevant. ss.3(3), 3(6), 3(7).

3. High-Value Transactions

Enhanced Scrutiny Requirements

Section 4

Financial institutions must apply enhanced scrutiny when transactions:

• Exceed D500,000 for an individual; or

• Exceed D2,000,000 for a body corporate; or

• Are unusually complex; or

• Have no apparent lawful or economic purpose. s.4(1).

The institution must investigate:

• The source of funds.

• The destination of funds.

• The purpose of the transaction.

• The identity of beneficiaries. s.4(1)(c).

Reporting Obligation

If there is reasonable suspicion of money laundering, the institution must prepare a report and submit it to the Supervisory Authority. s.4(2).

4. Suspicious Transaction Reporting

Mandatory Reporting

Sections 5 and 7

Financial institutions must report suspicious transactions involving:

• More than D1,000,000 for individuals; or

• More than D2,000,000 for corporate bodies. s.5(1).

Reports must be made to law enforcement authorities within seven days. s.5(1).

Under section 7, suspicious transaction reports should generally be made within three working days after suspicion arises. s.7(1).

Public Reporting

The Act also permits private individuals to voluntarily report suspected money laundering transactions involving:

• More than D200,000 for individuals; or

• More than D2,000,000 for corporate entities. s.5(2).

5. Prohibition on "Tipping Off"

Do Not Warn the Customer

Sections 4(3) and 23

Once a suspicious transaction has been reported:

• The customer must not be informed.

• Information about an investigation must not be disclosed.

• Employees must not alert persons whose funds are under scrutiny. ss.4(3), 23(1)(a).

A person who prejudices an investigation by disclosing information commits an offence. s.20.

Penalty

Fine of D100,000 and/or imprisonment of between 5 and 15 years. s.20(2).

6. Record-Keeping Requirements

Customer and Transaction Records

Section 8

Financial institutions must maintain records of:

• Transactions exceeding D200,000.

• Identity documents.

• Customer information.

• Account details.

• Transaction histories. s.8(1)-(2).

Retention Period

Records must be maintained for at least six years after the transaction or business relationship ends. ss.8(3), 12(a).

Why This Matters

Investigations often occur years after the original transaction. Failure to maintain records can expose institutions and individuals to criminal liability. s.23(1)(b).

7. Internal Compliance Programmes

Compliance Systems

Section 9

Financial institutions must establish internal procedures that:

• Identify employees responsible for reporting suspicions.

• Require escalation of suspicious activity.

• Create reporting channels.

• Train staff.

• Promote awareness of anti-money laundering laws. s.9(a)-(e).

Investor Consideration

Investors undertaking due diligence should assess whether a target business has documented anti-money laundering policies. Weak compliance controls may create significant regulatory and reputational risk. s.9.

8. Powers of the Supervisory Authority

Regulatory Oversight

Sections 10-15

The Supervisory Authority is responsible for:

• Receiving reports.

• Conducting inspections.

• Examining records.

• Issuing guidelines.

• Providing training.

• Sharing intelligence with law enforcement. ss.10-12.

The Authority may enter premises of financial institutions during business hours to inspect records and question personnel. ss.11(c), 12(c), 13.

The High Court may issue injunctions compelling compliance. s.15.

9. Cash Reporting When Leaving The Gambia

Border Reporting Requirement

Section 16

Anyone leaving The Gambia carrying:

• More than D300,000 in cash; or

• Its equivalent in negotiable bearer instruments,

must first report that fact to the Supervisory Authority. s.16.

Penalty

Failure to report is an offence punishable by a fine of at least D10,000. s.16.

10. The Offence of Money Laundering

Core Offence

Section 17

A person commits money laundering if he or she:

• Acquires criminal proceeds.

• Possesses criminal proceeds.

• Uses criminal proceeds.

• Transfers criminal proceeds.

• Assists in concealing the criminal origin of property. s.17(1).

The offence applies to proceeds generated in The Gambia or abroad where the underlying conduct would be criminal in The Gambia. s.17(1)(a).

Penalties

Individuals

• Fine of at least D100,000.

• Imprisonment between 5 and 15 years.

• Or both. s.17(2)(a).

Companies

• Fine of at least D500,000. s.17(2)(b).

11. Related Money Laundering Offences

Laundering Criminal Proceeds

Section 18

Transactions intended to:

• Promote unlawful activity.

• Conceal ownership.

• Conceal source of funds.

• Avoid legal reporting requirements.

constitute offences. s.18.

Penalties

Corporate body:

• D1,000,000 fine. s.18(2)(a).

Directors and officers:

• Minimum imprisonment of 5 years. s.18(2)(b).

Transporting Illicit Funds

Section 19

It is an offence to transport criminal proceeds into, out of, or through The Gambia for the purpose of concealing unlawful activity. s.19.

Penalty

• Fine of D1,000,000 or twice the value transported.

• Imprisonment of at least 5 years.

• Or both. s.19(2).

Destroying Evidence

Section 21

A person commits an offence by:

• Falsifying documents.

• Concealing documents.

• Destroying records.

• Removing records relevant to an investigation. s.21(1).

Penalty

• Fine of D100,000.

• Imprisonment of 5 to 15 years.

• Or both. s.21(2).

12. Corporate Liability

Liability of Directors and Managers

Sections 6 and 25

Directors, managers, secretaries and other officers may be personally liable where offences occur through:

• Neglect.

• Connivance.

• Instigation.

• Participation in a conspiracy. ss.6, 25(1).

Winding-Up Risk

Where a body corporate is convicted, the Court may order:

• The company to be wound up.

• Its assets to be forfeited to the Government. s.25(2).

This is one of the most severe corporate sanctions under Gambian legislation.

13. Freezing and Forfeiture of Assets

Freezing Orders

Section 28

The High Court may freeze property where a person has been charged or is about to be charged with a money laundering offence. s.28(1).

The Court may also permit:

• Payment of legitimate debts.

• Preservation of property.

• Living expenses for the affected person and family. s.28(2).

Forfeiture

Section 29

Upon conviction, the Court must order forfeiture of:

• Criminal property.

• Criminal proceeds.

• Instrumentalities used in offences. s.29(1).

If the property cannot be located, equivalent-value property may be forfeited instead. s.29(2).

14. Protection for Innocent Third Parties

Bona Fide Owners

Section 30

The Act protects innocent parties who can demonstrate:

• A legitimate legal interest in property.

• No participation in the offence.

• No knowledge of illegal use.

• Good faith acquisition. s.30(4).

This protection is particularly important for investors, lenders, banks and business partners who may otherwise be affected by forfeiture proceedings.

Key Compliance Checklist for Businesses

Businesses should:

✅ Verify customer identity. (s.3)

✅ Identify beneficial owners. (s.3(6)-(7))

✅ Investigate unusual transactions. (s.4)

✅ Report suspicious activity promptly. (ss.5, 7)

✅ Maintain records for at least six years. (ss.8, 12)

✅ Train employees. (s.9(e))

✅ Establish internal reporting procedures. (s.9)

✅ Cooperate with regulators and investigators. (ss.11-15)

✅ Never tip off customers about investigations. (ss.20, 23)