Application deadline: April 21, 2024 at 11:59 p.m. GMT

iWatch Africa

iWatch Africa is a non-governmental media and policy organization focused on transparency and accountability based in Ghana. We are focused on media development initiatives including tracking and reporting on digital rights, trans-national organized crime, Illicit Financial Flows, human rights abuse, climate change and environmental abuses in Africa. We are part of Thomson Reuters Foundation’s 3-year project on Illicit Financial Flows in Africa, focusing on Kenya, Tanzania, Rwanda, Mozambique and Ghana.

About the Thomson Reuters Foundation

The Thomson Reuters Foundation is the charitable arm of Thomson Reuters, a global provider of independent international news and information. As an independent charity, registered in the UK and US, we work to advance media freedom, foster more inclusive economies and promote human rights. And through news, media development, free legal assistance and advocacy initiatives, we combine our media and legal services to drive systemic change.

We are accepting applications on a rolling basis, please apply as soon as possible.

With financial support from the Norwegian Agency for Development Cooperation (Norad), iWatch Africa and Thomson Reuters Foundation is seeking Ghana journalists motivated to understand how their country and/or other countries of the African continent could lose money illicitly. This training objective is to find Africa’s missing billions, lost to illicit financial flows (IFF) through investigative reporting.

The program is a long-term commitment and journalists participating in the program must sign an agreement that commits them to the following elements of the training program:

• Intensive training on illicit financing reporting.

• The first workshop will take place from Monday, 29th April to Friday 3rd May 2024 (5 days) in Accra.

• A second workshop will take place a few weeks after the first training in Accra – TBD.

Participants selected for the program will:

• Produce and publish one or more articles on illicit financial flows.

• Receive mentoring and editorial support to help them produce the story/stories.

Journalists will not be considered to have completed the program until they have completed all elements of the program, including the production of at least one article on illicit financial flows. They will also not be able to receive their certificates before this stage.

PROGRAM BENEFITS

• If selected, you will participate in two intensive workshops covering illicit finance, business investigations, accounts and budgets, and investigative techniques. The workshops will take place in Accra.

• You will propose one or more story ideas that you would like to work on as part of the program and if you are selected, we will provide you with experienced journalists to help you produce your stories through to publication/broadcast.

• If you are selected, you will receive modest funding to help you realize your stories.

• You will have exclusive access to the expertise of our network of illicit financing experts.

• You will also have access to story ideas and editorial advice and will be invited to share your own expertise with other participants.

Successful applicants will receive full sponsorship which will cover accommodation and meals.

Who Can Apply

Application deadline: April 20, 2024 at 11:59 p.m. GMT.

We are accepting applications on a rolling basis, please apply as soon as possible.

Interested journalists should provide:

• A link to a sample of your work (copy of published articles, if links are not available).

• If your sample is published in the local language, please provide us with an English translation (if the link is online, please share it so the web page can be translated).

• A letter from your editor consenting to your participation in the program and confirming that they will publish your story produced under the program. If you are a freelancer, please provide us with a commitment from your media outlet confirming that your story will be published.

• For example, the letter should say “I confirm that we will publish the story produced under the program.”

• If the letter from your editor or press organization does not explicitly state this, we will not be able to consider your application.

Please prepare all your documents before starting the application.

Please note that acceptance to the program does not mean that your story proposal has been approved. If you are accepted, the story proposal will be reviewed by our editorial team before approval.

Click on the link below to apply:

https://forms.gle/KwhSxFs1faAHwnbL9

If you have difficulty applying, please email info@iwatchafrica.org with the subject: ‘Ghana IFFs Training Program 2024’ – We cannot guarantee a rapid response if this subject is not mentioned.

The post iWatch Africa call for applications: illicit finance training – Accra appeared first on iWatch Africa.

The Finance Uncovered fellowship is a flagship program which is delivered by the Finance Uncovered team based in the United Kingdom and Free Press Unlimited as part of the Money Trail consortium, which also includes Journalismfund.eu and Oxfam Novib.

The fellowship, which is expected to focus on issues bothering on illicit financial flows and advanced digital security techniques, will also be attended by other leading activists, policy experts and investigative journalists from around the continent.

Read Also: Key findings of the TAC Baseline Study [Infographic]

Brief profile of Gideon Sarpong

2017 Thomson Reuters Foundation Fellow: Gideon Sarpong (G. K. Sarpong) is a media practitioner with over seven years experience in data, policy and investigative journalism.

Gideon is a co-founder of iWatch Africa and currently the Director of Policy and News. He is also the Communications Manager for AE Media in Ghana. Gideon is an e-commerce consultant for Department of Geography & Regional Planning and Department of Religion & Human Values at the University of Cape Coast. He is a columnist and regional editor for several local and international news portals and has authored over eight publications.

Gideon is a fellow of the Young African Leaders Initiative (YALI), Thomson Reuters Foundation, Commonwealth Youth Program, Bloomberg Data for Health Program and the Creative Commons.

He is a firm believer in the use of data and technology for development and is committed to promoting transparency and accountability in Africa.

by iWatch Africa | Follow @gideonsarpong

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The strategy, according to those closely involved, has seen importers faced with heavy customs duty and demurrage charges get away with billions of shillings in taxes, with some officials at the port of entry involved in the deal.

LOOPHOLES

Others are said to under-declare the goods before abandoning them, only to buy them back during the sale using different identities.

This deepens the tax bleeding in the scheme, which may be among the largest loopholes at the country’s entry point.

Last week, the Kenya Revenue Authority advertised several goods lined up for auction on May 15.

The cargo comprising close to 450 vehicles and several motorbikes was listed in a gazette notice complete with owners’ details and contacts.

Some of the listed owners, who agreed to talk anonymously, told the Sunday Nation that since the start of the crackdown on illicit imports, loopholes previously used to smuggle cargo have become rare, prompting errant traders back to the drawing board.

The new scheme involves importation of cargo with no intention to clear, but wait for them to be listed for auction and buy them at a price lower than the duty that was outstanding in the first place.

“Sometimes you import a car with a target client in mind but when the car lands here, you find the duty is way higher than you had envisioned. Without anywhere to sell, you leave it at the port, storage fees rise too high and your only other way out is to buy it at an auction like the one coming up,” a car dealer listed in the April 2019 action notice said. (https://nyicff.org/)

HIGH-END BRANDS

In the scheme, some importers ship one half of pairs of shoes before abandoning them to be auctioned as useless commodity.

They then buy them at the auction before making another shipment of the other half of the pairs and matching them at a godown – effectively evading tax.

The vehicles listed in the auction include high-end brands such as Range Rovers, Toyota Land Cruisers and BMW X5s, signalling the tax value the unscrupulous traders may evade.

According to other traders, high duty bills came as a result of the March 2019 revision of the Current Retail Selling Price (CRSP), the value KRA uses to calculate custom duty for imported cars.

CRSP, which is the estimated price of a brand-new version of the car an importer buys, is used by KRA to calculate the various duties and levies charged for imported cars. The levies include import duty, excise tax, value added tax, import license (IDF) and railway development levy.

Importers are also required to pay a registration fee, port charges and maritime levy, which in most cases vary according to the vehicle drive configuration (left or right-hand-drive), the fuel it uses as well as its mode of transmission) (manual or automatic) or any other enhancements.

Read Also: Ghana loses $18.9M as economic costs of violence against women

In March, KRA revised the CRSP for motor vehicles and motor bike classes, a yearly exercise done depending on the trend of importation to take advantage of the favourite makes and models and collect maximum tax.

SMALL ENGINE

A Land Cruiser VX with an engine capacity of 3,000cc and running on diesel was valued at Sh11.6 million while a 1,500cc Mazda Demio was priced at Sh1.6 million, which is then used to calculate the duties.

In the latest revisions from March 25, the taxman seemingly targeted the small engine capacity cars currently being favoured by mobile app taxi hailing services, including the Honda Fit, whose CRSP was set at Sh3.3 million for the 1,500cc petrol model.

Apart from cars and motorcycles, KRA has also lined up for auction tens of 40-foot containers full of used clothing, cooking oil, molasses, gas cylinders, car parts and special vehicles like dump trucks.

Sources believe the goods may have been misbranded by cartels out to evade taxes. During the auction, the unscrupulous traders are said to be able to organise for the bids to land on the target buyers.

Credit: Edwin Okoth | Daily Nation

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The threat posed by the 21^st century cybercriminal in earning money illegally and transferring it across borders with a simple mouse click, was realised when a syndicate of 26 accused persons launched one of the most ambitious cybercrime schemes ever witnessed on the continent.

According to charges filed by the state at the Accra Circuit Court, the 26 accused persons, mainly made up of Ghanaian and Nigerian nationals, plotted to attack some major banks in Ghana in July.

“The attack began on the midnight of Sunday, July 22^nd, 2018, when the plotters hacked into the banking software of Universal Merchant Bank Limited (UMB) in Ghana.”

“The accused persons succeeded in debiting UMB’s income surplus account with GHC 326, 120,000 ($70m) and posted credit to eighteen bank accounts specifically opened for the purpose of facilitating the attack,” according to the charges filed.

The Deputy Superintendent of Police, Mawunyo Nanegbe revealed that, between midnight of July 22, 2018 when the attack commenced and the morning of July 23, 2018, a total of GHC1.9 million ($400,000) had been withdrawn from the 18 bank accounts standing in the names of the accused persons.

UMB in a statement after the attack insisted that the bank is “resilient and very committed to working with the security forces to clean the environment of any form of cyber miscreants.”

A representative for the bank did not immediately respond to a request for comment for this report.

Meanwhile, all 12 arrested individuals have pleaded not guilty to the charges leveled against them. The case is still at the pre-trial stage with the main trial expected to begin in 2019.

Digital Technologies and IFFs

Automation, a core enabler of the illegal digital economy, played a significant role in the attack as withdrawals of the stolen monies were made from some Automated Teller Machines (ATM) in Ghana, the United Arab Emirates and the United States using internationally accepted credit cards, according to people familiar with the case.

In an effort to conceal the illegal profit from the source, the suspects are believed to have also split part of the monies into small amounts below the reporting threshold and transferred to over twenty different beneficiaries via mobile money transfers. This process is often described by experts as layering and integration.

In 2016, a World Bank report found that cyberspace, with its anonymity, cross-border nature, and remoteness from the crime scene, constitutes a perfect environment, especially when criminals can operate from countries that do not have proper legal frameworks and technical capabilities for digital investigations.

The anonymity cyberspace provides in gaining and transfer of illicit funds is particularly relevant in the case of the UMB cyber-attack, as 14 out of the 26 accused persons still remain at large.

Criminal Underground Economy and Cost to the State

The rise of a criminal underground economy in Ghana, which specializes in committing crimes involving digital technology and illicit profit transfers, cost the state over a $100m, as contained in the 2017 BoG report titled State of Banking Sector Fraud.

The major line of attack for these cyber criminals is the “use of malwares,” First Deputy-Governor of BoG, Dr. Maxwell Opoku-Afari disclosed. Citing a recent African Union report, Dr. Opoku-Afari said that more than 400,000 malware incidents, 44 million spam incidents and 280,000 bots incidents were recorded in Ghana’s financial industry in 2016, making the country one of the top 10 most-attacked countries in Africa.

A malware is generally a software intentionally designed to cause damage to a computer, server or computer network. Cyber security and policy expert, Henry Kyeremeh, who works with the Ministry of Finance and Economic Planning (MoF) believes that malware, which usually comes in the form of viruses, trojans, key loggers and exploits kits offers cybercriminals the flexibility to “steal and control data, to manage malicious programs, and to run networks of interconnected computers infected with malware.”

The underground industry of cybercrime costs global economies as much as US$445 billion in 2016 up around 30 percent from just three years earlier, a global economic study found.  For the government, banks and payment companies in Ghana, the fight should feel like a war — and they are expected to respond with an increasingly robust approach.

Legal and Policy Framework

The July cyber-attack on UMB however exposed the ease with which digital technologies can fuel illicit financial flows. It also exposed the laxity of the financial actors in Ghana and the government in dealing with the threat.

The attack prompted the BoG to issue a directive in October 2018 requiring all banks to appoint a Cyber and Information Security Officer. A compliance review a month later revealed that out of the over thirty banks operating in the country, only a third had adhered to the new BoG directive demonstrating the general lethargic approach in addressing the evolving cyber threat.

Mrs. Mansa Nettey, the Chief Executive Officer of Standard Chartered Bank Ghana speaking at a Cyber Security Forum for the financial sector in late October, 2018 maintained that, “organizations must be willing to invest heavily in resources to combat cybercrime.”

According to the Standard Chartered CEO, financial institutions, “could reduce cyber risks by putting in place appropriate corporate governance and compliance procedures” and institute an “ongoing and open channel of communication with regulators,” on how to approach cyber threats.

Meanwhile, Henry Kyeremeh, the policy expert with MoF, has called for a revision of Ghana’s National Cyber Security Policy (NCSP), describing it as an “over concentration of efforts on protecting big companies and government agencies,” leading to a “total abandonment” of equally important players such as “citizens and SMEs.”

Four years after the NCSP action plan was developed, the government has failed to deliver on some key outputs, including setting up a Cyber Law Review Committee with the mandate of reviewing current laws on the cyber environment and making recommendations for the amendment of national laws.

Mr. Albert Antwi-Boasiako, the National Cyber-security Advisor to the government and founder of E-Crime Bureau, is of the view that despite passage of some laws including the Electronic Transactions Act (2008) and Anti-Money Laundering legislation, “these legislations are not themselves cyber-crime legislation.” Nigeria, he argued, has a Cyber-Security Bill (2015), whereas Ghana’s Evidence Act was passed in 1975 – long before personal computers.

Mr. Antwi-Bosiako maintains that, “Ghana needs to scale up our efforts to address the gaps in our national cyberspace legislation.” The big issue is that the legislation needs to be reviewed to be in line with contemporary trends, where e-evidence “becomes part of criminal proceedings,” — where we can use electronic evidence “to convict people for murder, narcotics, human trafficking, fraud, tax evasion, and terrorism.”

“Ghana needs to invest in technology and policies in cyber-security as the human factor remains the weakest link in cyber-crime cases.” By incorporating these recommendations into Ghana’s policy, we would, Antwi-Boasiako believes, be able to make a “serious case” in fighting cyber-crime and illicit financial flows.

This story was produced by iWatch Africa. It was written as part of Wealth of Nations, a media skills development programme run by the Thomson Reuters Foundation. More information at www.wealth-of-nations.org. The content is the sole responsibility of the author and the publisher.

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Titled “Illicit Financial Flows to and from Developing Countries: 2005-2014,” the report is the first global study at GFI to equally emphasize illicit outflows and inflows. Each is found to have remained persistently high over the period between 2005 and 2014. Combined, these outflows and inflows are estimated to account for between 14.1 and 24.0 percent of developing country trade, on average.

“The order of magnitude of these estimates, much more so than their exactitude, warrants serious attention in both the developing countries and the wealthier world,” said GFI President Raymond Baker, a longtime authority on financial opacity. “Years of experience with businesses and governments in the developing world have taught us that the decision to bring illicit flows into a particular developing country often marks only the first phase of a strategy to subsequently move funds out of the country. Together, illicit inflows and outflows sap the crucial financial resources needed to reach the Sustainable Development Goals.”

Read Also: Fact Check: Businesses to incur 5% VAT cost despite government claims that VAT has not been increased

Key Additional Findings

• An average of 87 percent of illicit financial outflows over the 2005-2014 period were due to the fraudulent misinvoicing of trade.
• Illicit financial outflows from Sub-Saharan Africa ranged from 5.3 percent to 9.9 percent of total trade in 2014, a ratio higher than any other geographic region studied.
• Total illicit financial flows (outflows plus inflows) grew at an average rate of between 8.5 percent and 10.1 percent a year over the ten-year period.
• In 2014, outflows are estimated to have ranged between $620 billion and $970 billion, while inflows ranged between $1.4 trillion and $2.5 trillion.

Credit: Global Financial Integrity

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Trade misinvoicing is a method for moving money illicitly across borders which involves deliberately misreporting the value of a commercial transaction on an invoice submitted to customs.

According to GFI’s 2017 report, Ghana is estimated to have lost $184,175,000 over the period between 2005 and 2014, due to trade misinvoicing.

The study also revealed that over the period between 2005 and 2014, IFFs likely accounted for between about 14.1 percent and 24.0 percent of total developing country trade, on average, with outflows estimated at 4.6 percent to 7.2 percent of total trade and inflows between 9.5 percent to 16.8 percent. The magnitude of estimated illicit inflows ranges from $1.4 to $2.5 trillion.

Illicit financial flows stem from two sources: (1) deliberate misinvoicing in merchandise trade (the source of GFI’s low and high estimates), and (2) leakages in the balance of payments (also known as “hot money flows”). Of those two sources, trade misinvoicing is the primary measurable means for shifting funds in and out of developing countries illicitly. Even using the lower of GFI’s two estimates for trade misinvoicing, GFI finds that an average of 87 percent of illicit financial outflows were due to the fraudulent misinvoicing of trade. (https://getdelmar.com)

This is a staggering figure, underlining the enormous harm done to Ghana and other developing countries by illicit financial flows, however they are generated. The order of magnitude of these estimates, much more so than their exactitude, warrants serious attention in both the developing countries and in the wealthier world.

Maximizing domestic resources and achieving sustainable development goals is dependent upon substantially curtailing illicit financial flows.

Key policy recommendations to governments in Africa

Beneficial Ownership

Governments should establish public registries of verified beneficial ownership information on all legal entities, and all banks should know the true beneficial owner(s) of any account in their financial institution.

Anti-Money Laundering

Government authorities should adopt and fully implement all of the Financial Action Task Force’s (FATF) anti-money laundering recommendations; laws already in place should be strongly enforced.

Country-by-Country Reporting

Policymakers should require multinational companies to publicly disclose their revenues, profits, losses, sales, taxes paid, subsidiaries, and staff levels on a country-by-country basis.

Tax Information Exchange

All countries should actively participate in the worldwide movement towards the automatic exchange of tax information as endorsed by the OECD and the G20.

Trade Misinvoicing

Customs agencies should treat trade transactions involving a tax haven with the highest level of scrutiny.
Governments should significantly boost their customs enforcement by equipping and training officers to better detect intentional misinvoicing of trade transactions, particularly through access to real-time world market pricing information at a detailed commodity level.
GFI has developed a product to assist governments in the detection of potential misinvoicing in real time: GFTrade™ is a proprietary risk assessment application developed to enable customs officials to determine if goods are priced outside typical ranges for comparable products.2

Sustainable Development

Governments should sign on to the Addis Tax Initiative to further support efforts to curb IFFs as a key component of the development agenda.

Report by Gideon Sarpong | Policy and Content Analyst | Source: Global Financial Integrity, 2017 Report

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