Beneficial ownership transparency in Liberia

  • Publication date: 18 May 2022
  • Author: Favour Ime

Support from the Opening Extractives programme

The benefits of an effective BO regime in Liberia cannot be overstated and the recently published National Risk Assessment (NRA) report prepared by the FIU further proves the need for these reforms. The report examines the ML/TF threats and vulnerabilities prevalent across different sectors and identifies areas of weakness in its AML/CFT system which require targeted responses. In the NRA report, access to beneficial ownership information was declared to be “very low”, due to the lack of a system to verify information provided to the LBR, and a lack of regulation and procedures to govern the submission and access of BO information.

The NRA report recommends that the driving agency – the LBR – should work with other key implementing agencies and stakeholders to ensure that BO data is accessible to regulators and competent authorities. One common thread that can be drawn from the vulnerability maps in the report, and the ratings given to the banking, insurance and security sectors, and the OFIs and DNFBPs, is that the access to beneficial ownership information was consistently rated “low” to “very low”. The lack of systems to facilitate the availability and accessibility of BO information thus contributes to the overall high level of vulnerability in the financial sector.

Under the AML/CFT Regulation, financial institutions are required to “identify the natural persons who are beneficial owners of legal entities and/or natural persons” , and obtain and maintain [33] documentary records of those beneficial owners which own, control or influence the business decisions of the legal entity. Financial institutions are also required to maintain current [34] information and records relating to the customer and beneficial owners. Where the LBR is able to [35] establish a legal and regulatory framework to support the collection of BO data and its publication, compliance with the BO-related obligations of the AML/CFT Regulations will undoubtedly be made easier.

Under the OE programme, the implementing partners, Open Ownership and the EITI International Secretariat, will collaborate with LEITI, Open Government Partnership and local stakeholders to operationalise the BO register for the extractives sector (mining, forestry, agriculture, and oil and gas) within Liberia. Using our understanding of the gaps and opportunities for BO transparency reforms gained from this scoping study, Open Ownership will offer technical support which includes:

  • guidance on the development of BO regulations to comprehensively cover the gaps highlighted in this report and meet the best practice recommendations of the Open Ownership Principles;
  • guidance on software integration at the LBR and compliance with the Beneficial Ownership DAta Standard (BODS);
  • development of user-centred BO data collection forms and accompanying manuals;
  • technical assistance on how to approach implementation issues such as public access, what effective sanctions could look like, privacy concerns and verification.

[33] Regulation 3.3 of the AML/CFT Regulations for Financial Institutions

[34] Regulation 3.1.4 of the AML/CFT Regulations for Financial Institutions

[35] Regulation 3.9 of the AML/CFT Regulations for Financial Institutions

Next page: Conclusion