In the West Africa sub-region, the principal sources of money laundering are from the illegal exploitation of natural resources especially in mining, and to a large extent the proceeds from corruption. Concern over Money Laundering is growing because of its perverse effects on the socioeconomic environment and its close links with organized crime. Armed with the immense financial resources at their disposal, money launderers can compromise persons and institutions to acquire economic, social and political power. The ten-year rebel war that officially ended in 2002 sadly illustrates the threat and problem that Money Laundering poses to emerging economies like Sierra Leone’s. The AFRC and RUF using a network of criminal gun running organizations to finance their activities completely destabilized our nation politically, socially and economically. Diamonds obtained by forced labour from the nation’s diamond fields (blood diamonds) played a significant role in fuelling the rebel war. Although the war ended in 2002, the environment wherein criminals can launder their ill-gotten fortunes still prevails today because Sierra Leone is characterized by the following socioeconomic features:•  A large and porous border that gives ample opportunities to criminals who can sneak in and out undetected. •  A large informal sector which is extremely difficult, if not impossible to regulate. •  The preponderance of cash in the payment system due to low level of development and outreach of the financial system. •  Corruption. •  The presence of valuable minerals (gold and diamonds), which are easy to smuggle.
•  Limited capacity of trained personnel, logistics and finance to combat Money Laundering, among others. The Anti-Money Laundering Act was passed in June 2005 and this appoints the Governor as the Anti-Money Laundering Authority. This Act was passed mainly as a preventive measure against Money Laundering and to provide for a sound financial system. To discharge the responsibilities of the Authority, the Bank of Sierra Leone must establish a FIU to analyse and process reports relating to suspicious transactions from Financial Institutions. A committee of stakeholders in the  BIS Review 79/2006  1  implementation of the Act was established and is chaired by the Governor of the Central Bank. This committee comprises, the Ministry of Finance, Attorney General and Minister of Justice, Ministry of Foreign Affairs and International Co-operation, Ministry of Mineral Resources, the Ombudsman, National Revenue Authority (NRA), Inspector General of Police (IGP), Criminal Intelligence and Security Unit (CISU), National Drug and Control Agency NDCA), Anti-Corruption Commission, and The Association of Commercial Banks. Since the establishment of this committee several positive measures have been taken in the implementation of the Act: currency declaration forms for passengers travelling to and from Sierra Leone will now be administered by the National Revenue Authority (NRA). Financial Institutions are also implementing Customer Due Diligence and Know Your Customer principles. Technical assistance was sought from the UNODC by the Bank of Sierra Leone for the establishment of the FIU.