Ghana BoG: Undeclared Forex Warning Issued, Committee Formed

• Bank of Ghana Governor Dr. Johnson Pandit Asiama warned that substantial undeclared foreign currency movements through Ghana's airports and border points threaten the nation's financial system integrity.
• The Bank of Ghana has inaugurated a Preliminary Investigation Committee on Seized Foreign Currency to address this serious systemic gap.
• Undeclared currency flows facilitate illicit activities like money laundering and tax evasion, weakening financial intelligence and undermining the formal foreign exchange market.
• The BoG is collaborating with the Ghana Revenue Authority, Ghana Airports Company Limited, National Security, EOCO, the Financial Intelligence Centre, and the Attorney General’s Office.
• This multi-agency effort aims to safeguard Ghana’s borders, markets, and resources for all citizens.

The movement of undeclared foreign currency through Ghana’s airports and border points poses a significant threat to the integrity of the nation’s financial system.

Bank of Ghana Governor Dr. Johnson Pandit Asiama has issued a stern warning regarding the substantial movement of undeclared foreign currency through the country's airports and border points. This practice, he noted, poses a direct threat to the integrity of Ghana's financial system, as significant amounts of foreign currency are reportedly entering and exiting the nation without the necessary declarations.

In response to this pressing concern, the Bank of Ghana has taken a decisive step by inaugurating a Preliminary Investigation Committee on Seized Foreign Currency. This multi-agency committee has been tasked with addressing what Governor Asiama described as a serious gap within the financial system, aiming to bring greater transparency and control to currency flows.

The establishment of this committee underscores the central bank's commitment to tackling illicit financial activities and ensuring compliance with foreign exchange regulations. The Governor's remarks highlight the urgency of the situation, emphasizing the need for robust measures to safeguard the nation's economic stability.

Governor Asiama elaborated that the issue extends far beyond the mere physical movement of currency. He warned that undeclared foreign currency flows are instrumental in facilitating serious financial crimes, including money laundering, tax evasion, and various other forms of illicit activity. These transactions, he stressed, critically weaken the financial intelligence mechanisms that authorities rely upon to effectively monitor the system.

Furthermore, the Governor pointed out that when currency moves outside declared channels, it directly undermines ongoing efforts to strengthen Ghana’s formal foreign exchange market. By diverting funds away from legitimate avenues, these undeclared transactions impede the development and stability of the formal market, impacting its overall efficiency and integrity. This diversion creates an uneven playing field and can distort economic indicators, making it harder for the central bank to implement effective monetary policies.

To combat this multifaceted challenge, the Bank of Ghana is actively collaborating with a range of key national institutions. This concerted effort involves the Ghana Revenue Authority (GRA), Ghana Airports Company Limited, National Security, the Economic and Organised Crime Office (EOCO), the Financial Intelligence Centre (FIC), and the Attorney General’s Office. This broad collaboration signifies a unified approach to enhancing oversight and enforcement across various sectors.

The primary objective of this extensive inter-agency partnership is to safeguard the country’s borders, markets, and resources for every Ghanaian. By pooling resources and intelligence, these bodies aim to create a more robust framework for detecting, investigating, and prosecuting those involved in undeclared foreign currency movements and associated illicit activities. This coordinated strategy is crucial for reinforcing the nation's financial security and ensuring compliance with international standards.

Lawyers and compliance officers in Ghana should advise clients on the heightened scrutiny and enforcement risks associated with undeclared foreign currency movements, particularly at airports and border points. This development signals increased inter-agency collaboration to combat financial crimes like money laundering and tax evasion, necessitating strict adherence to foreign exchange declaration requirements to avoid investigations and penalties.

Source: Original reporting via Ernest K. Arhinful